tv The David Rubenstein Show Peer to Peer Conversations Bloomberg May 1, 2022 2:00pm-2:31pm EDT
david: this is my kitchen table and also my filing system. over much of the past three decades, i've been an investor. the highest calling of mankind, i've often thought, was private equity. [laughter] and then i started interviewing. i watched your interviews, so i know how to do some interviewing. [laughter] i've learned from doing my interviews how leaders make it to the top. >> i asked him how much he wanted. he said $250,000. i said fine. i did not negotiate with him and i did no due diligence. david: i have something i would like to sell. [laughter] and how they stay there. you don't feel inadequate now being only the second wealthiest man in the world, is that right?
[laughter] one of the most influential figures in the world of philanthropy is darren walker. he currently heads the ford foundation and has revolutionized its giving. he is also an influential figure in the world of culture and arts. i had a chance to talk with them about how he rose from modest circumstances in texas to become a leading figure in the world of philanthropy, culture and art. darren, as the head of the ford foundation, you are one of the most important people in the world of philanthropy. but tell us, how has the world of philanthropy changed because of covid? darren: i am not sure i would agree i am the most important. i am part of the constellation of people who are lucky enough to lead foundations like ford or rockefeller. but covid has absolutely impacted how we do our work both internationally and domestically. let's start with internationally.
the reality of this moment is that we are seeing tremendous inequality in the ways in which vaccines are being distributed, the ways in which they are being manufactured, and the issues around cost, intellectual property, which are profound and are having a tremendous negative impact, especially for people in africa and much of the global south. in the united states, we know that covid has meant that communities that are historically the most vulnerable are doubly impacted because of covid. and so, what that has meant for philanthropy is we have had to double down in some ways and
double down in some ways and also recognize in the united has coincided with the george floyd racial reckoning moment. that has brought into stark relief the challenges for people of color. especially in low income communities. david: let's talk about the ford foundation. when covid came, you convinced the ford foundation trustees and some others to borrow money. you borrowed $1 billion. why did you need to do that? darren: we needed to do that because, at the beginning of covid back in march and april of 2020, the markets were very choppy. what i was concerned about was on the one hand, on the needs side, we were hearing from many arts organizations, organizations working on food security and direct services that they were in huge distress. remember, arts organizations had closed their doors. there was no revenue appeared the nonprofit fundraisers had been canceled, donors were beginning to get a little nervous about pledges. we would see the need to increase our spending while at the same time our denominator, our endowment, was going down in value. i had seen that happen in the last market cycle where the need
went up and our endowment went down. in order to address the needs side while maintaining good fiscal responsibility of managing the endowment and, of course, because of the luck of having jerome powell in charge of the fed and announcing in the middle of march that money was free basically, and what happened with the yield curve made it quite possible for us to think about debt as opposed to taking money out of the endowment. it was a matter of arbitrage. david: was it hard to convince your trustees to do that? darren: initially, they thought it was out-of-the-box because no foundation had done that before. once -- especially the investment committee -- started to think about the options, it became clear it was the best option. david: were you able to get other foundations to do the same? darren: there are a number of
foundations to have done this. -- who have done this. macarthur, kellogg, doris duke. we now have probably eight or 10 who have issued bonds. the bigger message was we needed to do more. that simply going by the irs minimum of 5% payout in the time of covid, in a time where we had more money than ever, it was not morally defensible to spend 5%. david: let's talk about george floyd. you have lived through the civil rights revolution in the 1960's. we had the post civil rights efforts in the 1970's and 1980's. it seems as if not until george floyd was murdered that some people in the corporate world took seriously the discrimination and other challenges african-americans face. was that your perception, that george floyd had an incredible impact? darren: i think what was different was that first, we were all at home as a country.
secondly, this was fully videotaped. from the moment he was put on the ground until his last breath. and that it was photographed. that it was videotaped. and that the perpetrator was fully aware that he was killing someone and clearly assumed he could do that with impunity. i think that is what we americans, the average american, found so appalling and so antithetical to our values as a people. and so, it had a huge impact far beyond the issue of policing and civil rights to the boardroom. david: do you think it will be enduring? there is a big effort to have more african-americans and women on boards, but do you think it will last? or is it for a short time after the george floyd murder?
darren: there is no doubt that some of the rhetoric from some ceos was performative. i believe we are seeing a real paradigm shift where we understand that diversity in the boardroom is more than one. i am a member of some public company boards. there was a time when there would be one black and one hispanic. and maybe one or two white women and you had diversity. i think now we understand that is tokenism. diversity is fully embracing the idea of the intersection of representation and talent and you can get both. david: do you think discrimination against african-americans is greater than discrimination against people who are gay? darren: i think race is a very challenging feature of american life. and when you look at the progress of lgbt, you think
about something like marriage equality, which polled in the low double digits as recently as 15 years ago, and now a majority of americans support. i think part of the reason for the progress was because most americans, most white americans could relate. they could relate to ellen degeneres coming out on abc on national tv because she was the girl next door they had fallen in love with for five seasons. they could relate to some of the people who were on the front lines leading the efforts in the marches. they knew that these young people were their children and grandchildren. it is harder on the issue of race and it is because, in this country, we have a difficult history. i love the united states of america because i know that
there is no country in the world where my story would be possible. i revere the founding fathers in spite of their flaws because they made it possible to actually fix the problems they did not have the courage or the will to. and so, i believe that we have to deal with that fundamental history, the contradictions and complexity of this country. ♪ david: let's talk about how yu
new york city. i was born in a charity hospital in louisiana. little town not far, i guess, from lafayette and baton rouge. david: you were raised by a single mother? darren: i was. david: and you grew up more in texas than louisiana. darren: we moved to ames, texas when i was little. david: and he went to the university of texas? darren: i am proud to say i never attended a day of private education in my life from head start through law school. public education was the path. david: you went to the university of texas. how did you do? darren: i was ok. david: were you elected president of the student government or something? darren: i was the head of a number of organizations and i was very lucky because i lived at a time in this country when i knew, in spite of the challenges i faced as a boy, as a young man, that my country was cheering me on.
i never for a moment felt that my dreams and aspirations could not be achieved and i never felt america didn't want anything for me but success. and so, yes, i had a great run in college and law school that brought me to new york. but the tailwinds were with me. david: but you must have suffered some discrimination in texas or louisiana as an african-american. was it difficult or was it not? darren: of course. there were many occasions, countless occasions, when i faced discrimination. i mean, i faced people saying things to me that were heartless and harmful and difficult to hear. i mean, i recall in high school when i won an election for student council and the person -- or a friend of the person who lost to me told me that no
matter how successful i might be in the future going off to the university of texas etc., that the most successful black man in america would always be below the least successful white man in america. so, i was told this when i was 16. imagine hearing that but also who taught a 16-year-old that idea? and so, i think about that when you ask questions like this. you know, did you face -- sure i did. i actually worry about that kind of thinking is instantiated in some segments of our society, which is so harmful to our democracy. david: you graduate from the university of texas law school and rather than stay in texas, you headed to new york and you headed to a very famous law firm. did you want to be a great corporate law partner? darren: no, i did not want to be.
what i wanted not to be again was poor. and when you grow up on the precipice of an economic collapse of your own family, it leaves you -- it leaves an indelible mark. when you are kid and you're waiting for your mother to pick you up at school after a debate tournament and she never turns out and you walk home and you find out it is because her car was repossessed, that leaves a profound mark on your psyche. and so, to be completely candid, i did not want to be poor. and i did not choose a clear path to wall street because i loved the law or when i left to go to ubs because i loved asset back collateral. i liked the idea of some
semblance of financial security for me and my family. david: so you made some money at cleary gottlieb and then you went to ubs. you are in the financial services world as it is called. you left to go work in nonprofit in harlem. why did you do that? darren: for me, it was never about piling up money. for me, it was ultimately about service. david: you did that for a number of years. you did that for a number of years. then you joined the rockefeller organization. then you were recruited to go to the ford foundation. darren: i went to ford as a vice president. ford was a much larger foundation. it was a lateral move but i had a bigger remit. david: ford was looking for a new president and you were one of the candidates. you went into the interview and said, i am going to change this completely if i get this job. i'm going to focus on social inequality and make everything dealing with social inequality our focus.
darren: what i said was the foundation was to disparately organized and we needed a single -- too disparately organized and we needed a single northstar for our work, which we did not have and never had. david: when you got the position, ford announced we are going to focus solely on inequality. what did your recipients of your age say? darren: part of it is stepping back and asking why did you focus on equality? the reason i believed in -- inequality was important was because of our mission. our mission was to strengthen democracy. i believe that among the
greatest threats to our democracy was growing hopelessness. and hopelessness occurs in societies where there are high levels of inequality. and so, the correlation between hopelessness and inequality is what is a threat to our mission. the goal was to get people, no matter what you are working on, to understand if it is having some impact on poor people because of the growing inequality in the world. david: you get the job. you convince the board to do this but then you have to do the work of convincing your staff people to change what they have been doing for so many years. was that hard to do? darren: it was not without difficulty. it was not without some long-term employees leaving the foundation. it was not without some long-term grant organizations leaving the foundation. david: did you feel any insecurity? darren: no. i mean, the role of a foundation
leader like me is one of great privilege. i say that with all humility because this is not about me as a person. this is about the job i hold. i am under no fantasy or understanding of why, as you say, i may be in demand. i am not in demand because darren walker is that interesting of a person. i am in demand because i am president of the ford foundation. when i am no longer president of the ford foundation, i can assure you i will have lots more time to have dinner with you. david: the jeff bezos fortune. he is giving away money. his former wife is giving away money. is that a new model? darren: no country in the world has the diversity of ways of giving as we do in the united states. so, i celebrate every time a new foundation is created in whatever form. ♪ david: in the early part of te
20th century in the mid part of the 20th century, wealthy people all set up foundations where they would take their stock or other assets and put in a foundation and, to some extent, it would be controlled for a while by families and eventually the families would not be in control. the ford foundation, henry ford famously got off the board many decades ago because he was not happy, it was said, with the ford foundation. you have reengaged with the family. was it hard to do? darren: henry ford ii left the board. it is true he was unhappy because the work that we did in the american south to advance integration and to support efforts to deem illegal
discriminatory practices was a problem because southern dealers felt the displeasure of southern consumers. so, henry ford ii was hearing from ford motor company dealers their consumers did not want to buy our cars. so, he decided to leave. we have been independent of the ford family and ford motor family for over six decades. i believed it was critically important for us to re-engage the ford family. this is where the money came from. it was important to reengage in the city of detroit. this is why we played a pivotal role in the bankruptcy. re-engaging with the ford family was easy. bill ford and his mother, martha firestone-ford, are among some of the most amazing people i know. they were happy to re-engage. we two years ago elected henry ford iii, the grandson of henry ford ii, to our board.
david: as i mentioned, a lot of prominent people when they get to be 60, 70, maybe 80, they would set up these foundations. a lot of people have gotten very wealthy in their 30's, 40's and 50's and they don't set up these traditional foundations. they give away the money in different ways. is that the new model, which is to say something like what is being done with, let's say, the jeff bezos fortune? he is giving away money. his former wife is giving away money. is that a new model or do you think the traditional model, the rockefeller model, will stay as the model for large philanthropic foundations? darren: i think the model of philanthropy over many decades will continue to exist but the exciting thing about this moment is there are new models. and you mentioned two terrific ones like what jeff bezos is
doing as well as mckenzie scott. or what the zuckerbergs are doing. all of these are part of the landscape of philanthropic pluralism, which we should celebrate. no country in world has the diversity in ways of giving that we do in the united states. so, i celebrate every time a new foundation is created in whatever form. david: let's suppose you are an average person. why should you want to give away money? why not just buy things for you and your family? darren: first of all, some of the best philanthropists in this country are small donors. they understand what it is like to work really hard and for many of them, they don't have a lot of disposable income, and yet, they give to their church. they give to their food pantry. they give to their homeless shelter. that is because, in this country, there is a civic
imperative of the individual to do what he or she can to make a difference in improving our communities. i celebrate those small impactful donors. but i also worry that for many wealthy people, the idea of giving often is not driven by a sense of just making a difference, but it is making a difference with strings attached. it is making a difference but doing it the way i want it done rather than what the experts might say. and so, it is that calibration that concerns me. david: you and i serve on the national gallery of art board. every art institution wants you to serve on their board. what is it about art that attracts you? darren: art is essential in democracy, david.
art is so important. we know what art does to young people. we know that exposure to art brings about higher levels of empathy. it helps other people understand how other cultures, other people live. and it just brings out the kind of humanity in all of us. there are times when i have observed leaders use language that is inhumane while talking about other human beings, while talking about the world. and i think to myself, this person has clearly never engaged in beautiful poetry. they have never listened to the words of a great playwright. they have never sat and reflected on a beautiful painting or picture. because if they had been really
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