Tmatters to humanitys optimism about its ability to achieve big things. The vacuum created by the u. S. Not having clear views in solving problems is is is very scary. Whos going to fill that void . Yeah, theres a lot of great countries around, but we should be proud of the fact that people still expect us to step back, really know the numbers, know the science. The good news for microsoft is the magic of the future visual recognition, speech recognition, letting you navigate rich amounts of information that is very software centric. And the Neat Services where your memories and what youre doing in your educational core, thats going to be kept in the cloud for you. That kind of plays to might rosofts strengths. Rose bill gates for the hour next. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Rose bill gates is here. He is, as you know, the chairman cofounder of the microsoft. His focus has been on philanthropic organizations since july of 2008 when he transitioned out of his daytoday role at the company to run the bill and Melinda Gates foundation, along with his wife. It is the Worlds Largest charity, devoted to improving Global Health and american education. The foundation is close to its target of eradicating the polio viking a goal bill gates is planning to achieve by 2018. I am pleased to have him back on the program. We come to you from the cbs news studio in new york. Welcome. Great to be here. Rose tell me this, the divisions in your life, which weve talked about before chairman of microsoft. Along with melinda, running the bill and Melinda Gates foundation. Theres a third thing. Whats the third thing, the catchall for the rest of the things you do . Well, innovation is what i love to work on, and so im spending time on Energy Innovation because we need cheap energy. We need clean energy. Im creating a New High School course because i think science and history can be brought together and made more interesting. Often, the money that lets you do the innovation is whats missing, and im lucky enough to have capital to whether its a new Nuclear Reactor or cheap solar, i can back some wild ideas so that i put time into that. And it lets me learn a lot of science, work with brilliant people. Rose i have in my hand the bill and Melinda Gates at annual letter from you from the foundation. Who is this directed to . Who are you who do you want to read this . Well, warren buff set sort of an ideal person id like to find it interesting because hes very busy doing his job, but he cares a lot about these issues. He knows i get to travel to africa. I get to see whats going on with budgets and science. Whats honestly taking place is there is the aid working . Wheres corruption blocking that . And so on a yearly basis, hed like to have me summarize where im optimistic, where we have setbacks, how should people think about the big causes education and the needs of the poorest. Rose whats interesting here, the theme of this is measurement. And you say thats crucial to have a goal and to be able to measure how well youre doing if youre going to reach the goal. Right. Its been stunning to me in the last year that the places weve done well are where were going and really be able to see whats going on. And, for example, if you want to get 90 of the kids vaccinated, then you better know within a month for this area, is it working . And if its working really well, what are they doing right . Why is it working here and not here . And the tools that let us measure sensors, satellitees, surveying people are much better. But idea of really bringing that to help the poorest, im stunned that that kind of thinking, systems feedback thinking is so rare. Soap i wanted to highlight that we have seen it work, and now we need to apply it a lot more than ever before. Rose you cite a book by a gay named William Rosen called, the most powerful idea in the world. And it was about steam engines. Right. So the world basically stayed the same in terms of livelihoods until the industrial revolution. And so the steam engine came along and it led to factories being able to make projects. Wool clothes became inexpensive. Cotton became available to everyone. And the question, what was the magic there . This books covered very well. And the point they make unless you can measure which engine is better than the others, all of these thousands of little small ideas dont get chosen. They dont add up. So without that feedback of whats better, whats going on, then progress doesnt happen. But once you have the measurement, then its obvious you discard this because its not as good and you pick this and then you make the next improvement. And that constant, welldirected feedback, once you have mum, it naturally emerges. Q. And technology makesmeasurem. Yes, business, technology, you know, becauseun youve got to pick whatever drives profit. If you dont pick tyou dont get to hire as many people. Companies disappear. In the private sector, the idea of measurement almost goes without saying. When you get to government, because they dont pick clear goals and they dont have training and measurement, its far more rare than it should be. Rose and i assume government in its aids programs are demanding more measurement because of the economic hard times and the stress on their budgets. Thats right. If were going to justify in very tight budget times taking this money that goes to the poor and making it a priority, people have to know that its not an image of the past where some dictator corruptly takes advantage of it, but rather that kids are getting malaria bed mat, and people are being kept alive on aids drugs. So the credibility of aid, which honestly in the past, some of it was misspent, we need to work on that or else it will be cut. Rose and you have made the point often that the problems in the world are too big for either n. G. O. S or foundations to do without significant government aid you cant conquer these problems. Thats right. Our Foundation Spends about 3 billion internationally with all the things we do. Overall, its 130 billion, and the u. S. Is about capitol hill 30 billion. Although having foundations like ours is a huge thing, the if the u. S. Cuts back in 10 , at least in dollar terms, youve cut out more than we bring. Rose in education, teachers sometimes object to be simply judged by teacher scores. This idea of measurement in eagle county, colorado, gave them a better way to evaluate performance. Thats right. You can say that teachers shouldnt be measured at all. Rose right. And the great ones are great and the average ones are average. Or you could say that they should be measured just by student test scores and i think neither of those is satisfactory at all. The test scores dont capture the whole picture. They actually dont tell you what that Teacher Needs to improve. So what were trying bring to this is the idea of surveying the students in a very smart way, asking them if the teacher uses time well, and which students they work well with, and using observationes, training both principals and teachers to go and sit down and be able to look for how you engage the class. And if we can train those evaluators well, then the teaching practice moves from thage up to the top car tile. That would make the u. S. System, which is now one of the worst in the rich world, absolutely the guest. Best. If we can fund it with 2 of the salary budget, it can be a phenomenal tool to make dication achieve the goals we have in mind. Rose jim grant is actually as important as henry ford, ford motor company, or tom watts orange the i. B. M. Company. What did jim grant do . Jim grant was the head of unicef, the United Nations organization thinking about children. And organizations like that, you know, talk about all the right things. But what he saw was that the vaccines werent getting out to all the kids. Only 25 of the worlds kids were getting vaccines. And he decided he would build a Measurement System this is in 1980. He built one that measured facts and coverage, and he would go and embarrass the political leaders whose countries had low numbers, praisethe ones who did it well. It was cheap snuff so incredibly impactful that he got vaccination from 25 up to over 70 . He saved more lives between 19 eighty and 1990 when he did that than anyone in all of history ever has, and yet, you know, hes not rose known by many people. Yeah, very obscure. When i went to buy the book about him, it was completely out of print. So its impress they have it was a Measurement System along with his moral correctness that let him achieve that dramatic result. Rose but the interesting thing, too swhen they stopped paying attention, it slid back down. Thats right. As soon as it wasnt there, and the political leader being told, hey, were falling behind these people. We need to get our vacinators to work harder or put more money into it, then it went down quite a bit. And a lot of new vaccines came along that didnt get out there to the poor children so the gap between a rich child that gap actually grew after the jim Grant Campaign had closed it quite a bit. Rose so turning to the United Nations, speak of great goals, there they are for the millennium grants. And theyve set forecast for 2015, things that theyd like to achieve. How well have they done . And how do you measure that success as you define new goals for the next time . Well, its actually pretty rare for the United Nations to talk about measurements. They usually talk in terms of absolutes, like rights for all, no more poverty. Here, what they did is phenomenal. They picked goals, eight of them. Number 1 is about poverty, cutting poverty in half by 2015. Its already been achieved. They picked childhood death rates, the number of kids who die under five, which was 12 million back in 1990. Its on a path by 2015 to be under six million. So thats a 50 reduction, faster than any time ever. And so the goals for the first time got u. N. Agencies and donors thinking, another does our money really impact this measure . Which country is doing it well . So ethopia is a star because although they started from a bad situation, they cut their childhood death rate in twothird, and that was by looking at people who had done it well, and now theyve become the example for all of africa how by putting in cheap, primary health care you can achieve an amazing result like that. Rose so on balance you give them high marks for what theyve of theyve been able to achieve even though they didnt meet the goals that were set . Thats right. We achieved maybe half the goals. The other half we set the parhigh enough that were not there. These are unique in getting people to collaborate. Its kind of a good news story, you know, cut category childhood death in half that i dont think thats out there. People see a small disaster that might kill a few hundred, but we went from 12 million a year, and well get to less than 6 million. That thats great. In the next 15 years id like to see us get below three million. Rose you understand this letter, from time to time we should step back and celebrate the achievements that come with having the right goals, combined with political will, enerous aid and it has certainly deepened my commitment to this work your commitment is pretty deep as it was. What do you mean by that, deepening your commitment . There are a lot of cynics out there who talk about, hey, theres corruption. Why should we do this . Its far away. And sometimes you feel like, gosh, thats such a constant thing. Are we really going to make it . Is this really as important as i think it is. And only by seeing the progress does it reenergize you to say yes. H1n1 like any time in history, this inequity is being closed, and, you know, that matters to the fathers and mothersful africa. And in the long run it marts to humanitys ability to achieve big things. If we can eradicate polio, i think thats uplifting to all of our endeavors. Rose and all this got started because you and melinda were look at a pie chart, and you saw something called what was it . Rotovirus. It was killing 500,000 children a year. And i said to melinda, i never heard of rotovirus. Shed never heard of rotovirus. Is it some super difficult thing to get rid of . In fact, rich kids who have almost no risk of dying of it they might get a little sick they had a vaccine that worked super well. And the reason you had a half Million Deaths a year was because it wasnt cheap enough and it wasnt delivered to all the children of the world. And that sort of became the centerpiece of, okay, weve got to do the Foundation Work now instead of waiting. And then warren came along and doubled the resources we have. Rose but that pie chart changed your life. It became the centerpiece of how i was gog spend my postmace career. Rose what are the metrics of success for you . Well, i take this childhood death number and say thats a report card for all of humanity. Rose right. Because if you look at it, annual childhood death at that time was what, 20 million . You have to go back quite a ways to get to 20 million. In 1990, it was 12 million a year. Rose 12, okay. Today its what, 6 . 6. Sorry, just 6. 9 million so well get down below six. Rose but thats whats driving you, reducing young kids dying . Yeah, when theres science that we could do the invention and do the delivery to dramatically reduce that, its terrible that we dont. And yet, just capitalistic systems alone wouldnt get us to do that because these people have no money. And so what plans we can do is it can shed light on that and make sure the r d gets funded, that the deliver gets done. Rose one thing you decide me before is seeing what you have to do is show people whats going on around the world. It cant just be numbers. Has that experience changed you . I think to really commit yourself to this, you have to understand mentally, millions of kids, but you have to get your heart involved by going out to a malaria ward and see the parents of the children who are still dying, see it filled up with kids with cholera or rotovirus. And look at that and say, okay, this is what were trying to stop. Then every once in a while i go out and see there are less kids in those wards right now so you have that sense of progress. Its the individual cases. You know, like, i held in my hands a threeyearold girl who was one of the last in india to get polio, and she was smiling and happy. But she didnt realize that because her legs are paralyzed how thats going to make her life so much worse than it would have been if we had stopped polio sooner. Rose when you created the foundation the provision in the bylaws says youll spend all the money or the foundation will cease to exist 50 years after we changed that to 20 years. Rose 20 years after either you or melinda is no longer living. You both are dead. Exactly. Rose and because you wanted to make sure what by putting that in . We think we picked important causes for this era, and that all the resources that are independent foundation should be spent against those causes. Were sure that in the future there will be rich people. Theyll be more up to date about how to do things, how to execute things well. Theyll pick the right team and create visibility. But were sure we can make big progress in our lifetime. Rose you said you didnt like the implication that the problems were persist, despite the best efforts that you could make. Thats right. Rose you set the idea, we can accomplish this. And i dont want to hold back at all. I want all the resources to go against it because i know its important. And, you know, i dont think having the money way out there in the future will will be nearly as valuable as ending these disease. Rose so why is the eradication of polio so important that you consider it your most Important Mission . Well, the worlds put a lot into this. It started in 1988, when over 350,000 kids were being paralyze expected very quickly they got it down. And they spent billions and billions. In the year 2000, we looked like we were close. Were already giving and yet it turned out getting last few countries was very hard. There were some big setbacks in nigeria, the rumor that the vaccine sterilized women was a setback. Rose did people in the government start the rumor . Yes, somebody running for office in the north starte started that rumor. Now, later that very individual changed his mind and actually was publicly vaccinated his own children. But once a rumor like that gets out, its very hard to stop the damage. In fact, to this day, which is almost a decade later, in parts of northern nigeria, theres 20 of the households that the parents wont give the vaccine unless we bring in the religious leader and he really reassures them that, no, this is safe. The reputational vac ens are very fragile, and, you know, thats one of the big barriers. Rose but in the end, vaccines are your most important weapon. Theyre a magic tool. Polio will be eradicate bide the polio vaccine. Some day well have a malaria vaccine. Inventing and delivering vaccines, thats the biggest impact weve had so far. Rose im interested in the culture thing, too, because there are people who kill vacinators. Recently in the middle of december in pakistan, those going out to do the Vaccination Campaign were attending some were killed if you want north of pakistan, some down in karachi, and that is horrific. Its hard to understand why thats happening. No ones claimed credit. Weve gone a month now without much violence. We only have 250 cases last year in these three countries, and so the reason that were doubling down, erasing a big budget, making sure everybody is committed to this because its hard. Once you get to zero, you dent you dont have to buy more polio vaccines. All those resources get freed up to work on the next big challenge. Rose there are three countries left, afghanistan, nigeria, pakistan. Exactly. Rose and whats the percentage of polio casesem year now . The we had last year the lowest east was under 250. The majority were in nigeria, and the rest were in pakistan and afghanistan. So its minuscule and away are really, really close on this one. Rose is 2018 the number . Is that the date . Were committing we will get it done by then. You have to get to zero cases and wait two years for there not to be any cases. Rose but is the idea here, too, that you can win in the Global Health battle . Here is an example of what we can do . Absolutely. What were going to do to get rid of polio, that the systems were going to build to reach kids with other disease, that would cuttify it, but the victory of achieving good things will make it worthwhile. Rose if you get polio what disease are you saying you better watch out. Were coming after you next. I think as were close or at the polar eradication, then well step back and look at malaria, and well have new tools. And i think well put a agreement plan and go after that. Polio would be the second. So malayeria, hopefully, would be the third disease completely eradicated. Eradicated. Is there an appreciation of the need. The financial cases was a setback for so many things. Anything far away in distance or time, you know, when youve got problems here and now. They get less attention. So whether its the health of people in africa, or the challenge of climate change, and what thats going to mean in 40 or 50 years, the financial crisis reduced attention to these things. So Global Health, i think there is a consensus there. European governments have always been very generous on these things. And their rose why are they more generous than we are . Well, wit the u. S. Aid budget is not nearly as big as a partiage of our economy. Its about. 2 compared to germany and france are double that, and the really generous gives are above. 7. Theyre over three times, that people like swooden and norway. You could say your Defense Budget and aid budget, add those together, thats your International Engagement. Because we have by far the worlds biggest Defense Budget and we have the Biggest International engagement budget. The europeans choose to balance their International Engagement into vaccines and aids drugs and things like that. So theyre less about theyre more about getting people lifted up so they can be selfsufficient. Rose you get a lecture last week, yesterday yes, yes. Endowed by some journalists at the bbc, and whats interesting about it to me is you sailed three things. Three convictions. The first was your work had given you three convictions. One i want you to elaborate on this when had gone improves life improves because disease and bad help insinuates itself into every aspect of your life. Thats right. In our country, kids have such a healthy life, that they go to School Pretty fully equipped. Their brain develops and they can achieve their potential. In africa, almost half the kids are so damaged by malnutrition and other Health Things that theyre never going to do well in school. So theyre never going for themselves or their country and give in a productive way. If we can get the health improved, then it changes. And weve seen this. In societies where you get the health right, then all of a sudden you start to sigh the productivity goes up. Also, the thing thats so magic to me and i cant say it enough times of times is that paradoxically, instead of having more population growth yawz of because youre keeping more arb live, which would seem to be what you would be causing. Parents choose voluntarily to have less children because they have a sense they dont need to have as many to have a few survive to adulthood and take care of them. So then the benefit you see is that when population growth is less, everything feeding kids, educating kids, having enough jobs, having stability, take care of the environment that really becomes a crucial thing and a society can get on a path to be like the u. S. Rose give me an example of what excites you about what were looking from mapping of the human genome and all the progress made since 2001 when it was announce bide people who had been working on it so hard . Understanding the genome allows us to begin to understand how life works, including how disease works. So taking, for example, cancer, and saying, okay, that looks like Breast Cancer but its theres many different types there. So the drugs used to treat it should be custom ides according to that pattern. Youre starting to see the payoff on that. If you take plant because we can look at their d. N. A. We are beginning to understand plant diseases and saying okay how can we allow african farmers not have all these insects and diseases that lower their call the ral productivity to be about a fifth of what we have here in the United States. So the genetic revolution is going to give to us in many, many, many forms. When we finally get an aids vaccine, partly that will be because the basic science has given us the insight as to hue the immune system works. Rose really interesting stuff in cancer dying nottics, too. There is diagnostic, too. You have become interested in agriculture. Im a city boy and i didnt understand about rose you didnt plant anything. Where all that food comes from. But want 75 of the poor people in the world are people who live on very small farms. And thinking about okay, how do we lift them up . Forces you to say well, what was the green revolution in the 70s where wheat, rice, and corn productivity went up unbelievably. You know, why didnt that happen in africa . How do we carry that forward . How do we make sure its being done in a Sustainable Way and meet the food needs of the entire planet which are growing quite rapidly. Rose on climate change, how are we doing . On climate change, youd have to give us an fglu mine the world . Yes. We are flunking this one right at the moment. We should be first and foremost spending more on research because we need press conference throughs for very cheap National Guard dont emit co2s. And those research budgets stunningly havent gone up while weve spent a lot of money on deployment of noneconomic stuff thats valuable. We dont have a carbon tax. And the rose is its carbon tax the way to go. Not cap and trade, but carbon tax jathe difference between those are not that critical. Rose the idea is put a value on how much carbon you use. There are reasons are to do that. But because of the political realities, either one can be achieved. They both have the same effect, causing you to shift in making your energy in a way. You look at germany, and angela mirkle has basically sworn off Nuclear Energy. That is aa setback rose you disagree with the decision she made. Well, with the current generation of reacts, because of the fukushima accident rose theyre old. People are now worried about that. There havent been that many accidents, so you can have a reasonable disagreement about the current generation. There are generations coming that are inherently in their design form is more safe. If you dont like todays reactors you shouldnt group all the ways of generating Nuclear Energy that will come out. You shouldnt abandon those as well because we can make it so you dont need humans to make the right decision which todays reactors have that problem. Rose and whats the reaction in japan . Well, japan has most of its reactors shut down. But the theyll probably start back up the reactors. But whether they get involved in building new reactors, id say its a real question mark. China is the most aggressive right now in Building Nuclear actors. They have over 25 rose theyre doing everything. They go full steam ahead on everything coal, nuclear, alternative sources, solar, wind. Exactly. They need more increase in energy conservative, and write now right now the bulk of that are new coal plant because that is clear and the least expensive. Invention is anything to have to make the tradeoff look very different. Rose when you look at alternative sources here in the United States, people are talking about gas and that it can make us Energy Independent. Others raise questions about fracking, as you know. Fracking, the issues of not contaminating water, theres no doubt done properly its a very small extra cost. The local Environmental Issues can be taken care of. Theyre even looking at how the they recycle the water so theyre not demanding water that might be used for other purposes. Now, when you burn that natural gas, it still emits co2. But its a miracle for the u. S. And its great great so we should go full speed ahead on the development of natural gas because it will make us Energy Independent or if possible fuel independent or wel from around the world and the Political Considerations of that make it urgent to do. Right, and if we put a some price signal on carbon, this might be when you burn natural gas you may have to sequester the carbon and get it out of the atmosphere. Natural gas will compete with other things, but over time, even there, you want to requira the extra carbon recovery. Rose heres something you would know the answer to. Are we make anything progress in terms of Battery Development . And whats the problem that makes that so hard . Well, the batteries we have today, you know, edson came around. He would recognize them because theyre these chemical peels. The breakthrough withlicateium gave us a factor of three improvement. So the batters are not good enough to take Intermittent Energy sources, like wind or sun, and be able to store that energy so it can be available whenever you want it. It puts a limit on your energy system. A lot of it has to be like cool or nuclear where its 24 hours a day, whether the winds are blowing or whether the sun is shining. So if we had a battery miracle, there are two benefits to a battery miracle. One is that we could do electric cars enough range people would find them attractive. And so you move from gasoline to electricity for transport. The other is our Electricity Power generation, we could rely more on intermittent sources. So there are a lot of battery startups that have rose are you investing in batter startups . Im in a lot of batter startups and theyre cool. There are chemistries for small batteries and big batteries that look like theyre big change. That will be part of the mix. Some of them wont succeed, but there is more battery innovation now than at any time in the last 100 years. And some quite promising. Rose are you satisfied were doing enough on emission standards in america . Yeah, the u. S. The mileage standards are you know, we had a pause, now those are going up. Theres a lot of question about what should e. P. A. Do . Should it get involved in the co2 issue . Does it have the authority to do that or not . And tilt towards other sources of energy. Or making the coal or natural gas take the co2 and sequester it. Rose i talked to al gore last night who, as you know, is very strong, about some of the things you believe in. And yet at the same time, he talks with a certain cynicism about whats happening in you know where im going. Hes got a new book, too, called the future about washington and about dysfunction and about the power of money. Well, al gore knows a lot more about poo politics than i do. And its certainly disturbing that hes so concerned about it. Now, rose hes not the only one. No, i am, too. Rose exactly. When the insiders are worried, thats particularly scary. Now over time, its been a selfcorrecting system. You know rose you mean democracy. U. S. Democracy has taken where it was going to do the wrong thing for the country, somehow the voting process, the broader warn broad awareness got our country to come back. Our track record as a country relative to other countrie countries is phenomenal. So will those selfcorrecting mechanisms come along and allow us to make compromises so that we dont have a broken budget, so that we are functional . A Government Department only knowing what their budget is for two or three months, thats really so inefficient. I mean businesses would go bankrupt if they were run like this. Seats just doesnt meet management 101 to run a Large Organization not knowing is the budget going this way or this way. Rose and no other organization is any larger than the u. S. Government. Many people are dependent on these policies, whether its culture policies, aid policies. So we need better way of reaching compromises. Now, rose whats that way that you think might lead us there . I admit theres some mystery to how a centrist group will come in and say its not about its not simply about i hate government i love government. Its about the parts that work effectively. Can we curb medical costs . The dialogue hasnt started. Just saying more government or less government, the government pays, note individual pays, that doesnt start to get at the transcribe prb rose thats an economic issue, Controlling Health care for our economic future, is it not . Thats right. And we should get the smartest people looking at how we use innovation, better systems design, better competition, how we use that to take that cost curve and get it more in line with economic growth. Rose you have a lot of free time. Why dont you go to washington and say give me a chance. Ill put together a governor romney and well fix this . I think at some point the country is going to need to do that rose do what. Bring together a lot of i. Q. On the problem. On health care costes, absolutely. Right now, theres a lot of incentives to invent expensive cures that dont have much impact. And theres actually disincentive to do some of the things that would make the system less expensive. And thats not going to be an overnight thing. But at some point, the politicians will realize they need to pull together expertise. None of these budget things really get at that core issue. Rose you know that your friend and mine, warren buffet, has strong opinions about taxation. Do you share his opinions about what the tax on the wealthy of us ought to be and that we ought to pay more and its a fair thing to do . Yeah, theres two things two basic things i think warren would say. One is that the because your gains on capital are taxed at much lower rates, people like he and i pay lower rates than most working people. Even very wellpaid people like lawyers pay much higher rates than people like hedge fund peoples, or investors. And theres a question whether on a broad basis or through some sort of minimum tax like the buffet rule, if you could bring those closer together. Then second theres the question, if the government is going to be picking up Health Care Costs for anig of aging society with increased health costs where is the money for that going to come from . You cant cut enough other government things . So you either have the government continue to offer that and, therefore, you have to raise taxes. Or the government needs to back away from that promise. And, you know, i think raising taxes to some degree in the long run will be part of how we achieve it. Rose but as long as you make some reforms so that the structural issues are reduced. Yeah, the rate its going up, effective tax rate you would need, no one would like. As long as somethings growing faster than the economy is eats everything. So weve got to change that. Even once we fix it, there will still be, in terms of balancing budgets and keeping those medical promises, youll need more revenue or youll need to find other places to cut back. Rose no one trastles around the world more than you do. Maybe bill clinton. Yeah, the clintons. Rose the clintons, exactly. Does the world still look on the United States as the place that theyd like to see offer real Global Leadership . Absolutely. Its its almost daunting because they really do expect to us get our act together, and whether its global security, global invention, doing governance right, they look to the United States. Rose and what do they expect from us . They expect to us get our rose by example as well as need. Absolute. They expect, whether its towfd disease, whether its how you take care of your people as they get older. How you do education. How you keep driving innovation, how you deal with climate change, they actually expect the United States to take the lead. You know, as much as china is growing, nobody looks to them as a primary role model. Rose because they see the things they do that are not very attractive or because there are so many possibilities of social tension within a country that large . Ironically its partly because china is so inward looking. There are people worry, are they get to get theyve chosen to be answer inward work glg you mean about culture and everything else. They dont tell other countries how to do things. And they dont have a global presence. So the vacuum created by the u. S. Not having clear views and solving problems is very scary. You know, who is going to fill that void . Yeah, theres a lot of great countries around. But we should be proud of the fact that people still expect us to step back, really know want numbers, know the science and come up with solutions. Q. As you know better thananybog numbers in education and a whole range of issues where we seem to have lost our leadership. That is absolutely fair. And the fact we dont have a good teacher personnel system. Id love to see us fix that. I will say in terms of using technology in education, the pioneers who are coming up with the new requested ideafor that are overwhelmingly based in the United States. Rose speak about Online Education are you more enthusiastic about it now than youve ever been . Quite a bit. Rose because you consume it. Yeah but im unusual. Ive always had an interest in taking courses that is atypical. But as you go online and you can personalize it, you can get the best leath furze world and can look at the persons state of knowledge, and you can explain things in a way that might engage them better. Q. The interesting thing thathas seem to have more respect for it now. Fear, respect you have this dilemma that we need more people to be College Educated. The Unemployment Rate for College Educated is not bad. Its less than 4 . And the jobs of the future are more on that. But if the cost of education is going up and the amount of money for education is going down, we have a dilemma. Only technology looks as though it can take that cost which has been going like this, and for most students, bring it down. So its very timely that these online entrepreneurs that our foundation is the biggest backer of, that theyre coming up with internetdrifep ways of making education cheaper to deliver. Now we have to proved it out. Were at the army stage. What about a kid who is lost or not motivated. It cant just be for the elite. Thats where were already doing so well. It needs to be prove of proven but i feel very strongly we can tune it to work for all students, not only in the u. S. But worldwide. Rose look at technology, and let me talk about microsoft first. Youre the chairman of the company. I am steve balmen is the c. E. O. Are you happy whiz performance. He and i are the two most selfcritical people as you can imagine. There are a lot of Amazing Things that steves leadership got done in the company. Windows 8 is key to the future. The surface computer. Bing people seeing as a better search product. Is it enough . No, he and i are not satisfied that in terms of, you know, breakthrough things that were doing everything possible. Rose every time you see an article about microsoft, its not so much about the success of bing or one thing or the other, it is about what happened at microsoft. Or five things you ought to do to microsoft. When you see all this stuff, what do you think . We appreciate the advice. Laugi mean, there are a lot of things, like cell phones, where we didnt get out and lead very early. Rose why not . Did you just miss that . Its too complicated. Rose did you miss the cell phones . We didnt miss cell phones, but the way that we went about it didnt allow us to get the leadership. Its clearly a mistake. Were attack the whole concept that you dont want a tab the, a p. C. You want something that has the best of both and we are in a strong leadership position with that essentially new category. So, you know, its a very mixed bag, and thats what mat an amazing business. Its very, very competitive. Rose would it have been different if you hadnt gotten interested in solving the worlds problems. Thats one of those counterfactuals that youll never know. Rose all right, counterfactuals. I think we would have done worse on global disease if id stayed full time. Rose but you left at about the same time. I want to stay with microsoft, though. What does it need to do . Most people talk about google, apple, facebook, amazon. Samsung. Rose samsung is coming on strong. Theyre the star of place wheres you used to make big speeches. None of them understand software that deals complex information, like microsoft does. In fact, really only of those, google is the only one that is it are movie a software company. And so the good news for mace is that the magic of the future visual recognition, speech recognition, letting you navigate rich amounts of information that is very software centric. And the needs services, your memories, that will be kept in the cloud for you. That kind of plays to microsofts strepgz. Now, we need to show people thats the case by building these wonderful new cloud services. If you want to look at what your kids did or what you did in the past, now its so hard. Youve got photos here leathers there, bills over here. Its completely disorganized. In the future, with the right privacy controls which is a tricky part of it, your whole life of where you went, going back and sharing things with others you think they would be interested in. Its going to be utterly different. Were in a phase of great change where software and interface count a lot. You have at least Six Companies seizing this future rose i hear you saying microsoft will be fine because software is key. I believe that. Rose is that the essence of what youre saying . I think microsoft can surprise people, and sometimes its good when people are underestimating you. And i think oh, yeah, come on. Xbox has been a huge success. Dont go too overboard on me. It has done some wonderful things. When you have a product like bing thats a better product and youre trying to get awareness out there. That forces microsoft to be a better marketing company, and traditionally that has not been a huge strength. We have creative people saying,hey, dont just use the Google Search engine. Rose you know the answers to these kinds of things or at least you think about them, are apps going to replace Search Engines . Well, the Search Engine today doesnt really understand your question. It just gives you a burn of rinkses. So the ability to understand, oh, hes trying to pick a movie. Heres what hes already seen. Heres what he tend to like. Here is who is going with him. Here are the area theyll be in. You have to do all the work, you have to type the movies in and look at those theaters and reviews, and its the kind of work you shouldnt have to do. If you want to buy a gift for somebody in a creative way and look at differentis cho, its still hard to do. The Search Engines you wont type as much. Youll use voice more and they will be more task oriented than they are today. Fortunately, what counts is not staying still. Now, neither of those competitors so the thung that will improve life the most in terms of how we look at data, learn, and things like that, is the digital revolution. Its still the center of activity. Its not like the industry microsoft is in is some boring, unimportant industry. Oh, i should have switched and bought a network. Rose its the engine of the future. Its every bit as much as it has been. And thats why things like education, financial servicees for the poor, monitoring health, these things are all going to be built. Innovations in other areas are really built on the fundamental tools that that Amazing Group of i. T. Companies are providing. Rose theres a lot of analysis of sleep today. Do you sleep much . Yes, im i wish i was like these people who can sleep only four hours. Figet less than seven hours, my i. Q. Starts to drop. And i find that very disconcerting. So yeah i wish could get that seven hours back. Rose but you have to sleep seven or otherwise youre less efficient . Im less intelligent. I can get by for a while. Rose cant you nap . Im pretty good with napping, pretty good with jet lag. Im a night purpose so i get very excited about something thats going wrong or right and i find it hard to go to bed. So i get squeezed. If i have a morning appointment and you stay up until 2 00 in the morning, you start it fall behind. Reporter paul alan was in i think new mexico and you at harvard and you concluded this train was leaving the station and you better get on it so you left harvard and created software and you went on to do what has enalled you to expand your horizons and icponentially. You wrote at that time a kind of Mission Statement which was a computer whatever it was. Computer on every desk and in every home. Rose whats the Mission Statement for bill gates today . Well, if you want a broad one, its that which is the found auctions driving value. Its that all lives have equal value. So you say why do poor children die when other children dont . Why do some people have enough nutrition or reasonable toilets and other people dont . So those basic needs that through innovation, actually its very affordable will be, to bring them to everyone. Rose thank you for coming. Its a pleasure to see you. Thank you. Rose bill gates for the hour. Thank you for joining us. See you next time. Captioning sponsored by Rose Communications captioned by Media Access Group at wgbh access. Wgbh. Org