tv The David Rubenstein Show Peer to Peer Conversations Bloomberg January 19, 2022 9:00pm-9:30pm EST
♪ david: this is my kitchen table and also my filing system. over much of the past three decades, i have been an investor. the highest calling of mankind i have often thought is private equity. and then i started interviewing. i have learned from doing my interviews how leaders make it to the top. >> he said to 50 p i said fine. i did not negotiate. david: i have something i would like to sell. you don't feel inadequate being the second wealthiest man in the
world? is that right? of the most influential figures in the road of philanthropy is darren walker p he has the ford foundation and has revolutionized its giving. he is an influential figure in the world of culture and arts. i had a chance to talk about him -- talk with them about how he rose from modest circumstances to become a leading figure in the world of philanthropy, culture and art. as the head of the ford foundation, you are one of the most important people in the world of philanthropy. how has the world of philanthropy changed because of covid? darren: i am not sure i agree i'm the most important. i am part of the constellation of people who are lucky enough to lead foundations like ford or lockey -- 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. 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 having a tremendous negative impact especially for people in africa and much of the global south. in the united states, we know covid has meant that communities that are historically the most vulnerable are doubly impacted because of covid. what that has meant for philanthropy is we have had to double down in some ways and also recognize in the united states the covid movement has coincided with the george floyd racial reckoning moment. that has brought into stark relief the challenges for people
of color. david: let's talk about the ford foundation. when covid came, you convince the ford foundation trustees and some others to borrow money. you borrowed a billion dollars. 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. arts organizations that 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 they need when up and our endowment went down. any 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: where you able to get
other foundations to do the same? darren: there are a number of foundation to 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 of a rights efforts in the 70's and 80's. it seems as if not until george floyd was murdered that some people in the corporate world take 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. the moment he was put on the ground until his last breath. and that 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, the average american, found so appalling and so antithetical to our values as a people. it had a huge impact far beyond the issue of policing and civil rights to the boardroom should
david: do you think it will be empty -- do you think it will be enduring? there is a big effort to have more african-americans and women on board but 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. maybe one or two white women and you had diversity. i think now we understand that his tokenism. -- that is tokenism. diversity is embracing the idea of the intersection of talent and representation. 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. when you look at the progress of
lgbt, you think about something like marriage equality, which pulled 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 wear 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 were my story would be possible. i revere the founding fathers in spite of their flaws because they made possible to actually fix the problems they did not have the courage or the will to. i believe that we have to deal with that fundamental history, the contradictions and complexity of this country. ♪ david: today, ceos under pressure to say something about public issues. you think that is a good thing that jamie dimon or the ceo of starbucks could say things about policy issues that are outside of their domain?
>> we are human beings peered we have opinions. i don't think being ceo, co-ceo, chairman etc. means i cannot have an opinion about something and so i always put that in the context of when i am giving my opinion, this is my opinion. it is not have to be an opinion that represents starbucks or arial or jp morgan it i think i am allowed to say what i think. it does not mean i am right. i talk about truth. there is truth with a t. there is truth with a small t. it is truth with a small t. david: this country is bitterly divided between the left and the rated seams and government is not functional in many ways. are you optimistic about the country's future or are we hit to a dark -- or we heading toward dark path? >> i think we'll have to work harder to be more willing to listen to other points of view. at the same time, i think that -- i take that warren buffett view. i think if you are born in
america, you won the birth lottery. i think that america's promise remains very great because we have had a certain spirit in this country that i don't -- i think it is in our dna. i think if we can realize our best selves, which is what america was founded on, inclusion in terms of religion, in terms of people of all walks of life, being a melting pot, if we can realize that, our future and our possibilities are truly endless. the question is will we allow ourselves to realize that ? ♪ david: with talk about how you became the head of the ford foundation and your background. you are not from new york city.
is that right? darren: i am to fill enough from new york city. i was born in charity hospital in louisiana, a little town not far from lafayette and baton rouge. david: you are raised by a single mother. darren: i was. david: you grew up in texas more than louisiana. darren: we moved to texas when i was a little boy. david: you went to the university of texas. darren: i'm proud to say that i have never attended a day of private education in my life from head start through law school. public education was my path. david: he went to the university of texas. how did you do there? darren: i did ok. david:david: you elected student -- president of the student government? darren: i was the head of a number of organizations and i was 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 that america did not want anything from me but success. -- anything for me but success. i had a great run in college and law school that brought me to new york. the tailwinds were with me. david: 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 faced people saying things to me that were heartless and harmful and difficult to hear. 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. 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. did you face -- or i did. i actually worry about is 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 yucca i did not -- corporate law partner
? darren: no, i did not want to be. what i wanted not to be again was poor. when you grow up on the precipice of an economic collapse of urine family, -- of your own family, 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. to be completely candid, i did not want to be poor. i did not choose a clear path to wall street because i loved the law or when i left to go to ups because i loved asset back
collateral. i liked the idea of some semblance of financial security for me and my family. david: we made some money 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: from me, it was never about piling up money. for me, it was ultimately about service. david: who did that for a number of years. you joined that -- 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. he 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 are focus. darren: what i said was the foundation was to disparately organized -- was 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 inequality. the reason i believed in equality was important was because of our mission. part of our mission -- that among the greatest threats to our democracy was growing
hopelessness. and hopelessness occurs in societies where there are -- there is a high level of inequality. the correlation -- and hopelessness is what is a threat to our mission. the goal was to get people to understand matter what you are working on, 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: the role of a foundation
leader like me as 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 misunderstanding of why i may be in demand. i'm am not in demand because aaron 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. i celebrate every time a new foundation is created in whatever form. ♪
david: either early part of the 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 foundation would be to some extent controlled for a while by families and eventually the families would not be in control appeared in 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 reengage the family. was it hard to do? darren: henry ford the second 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. henry ford the second was hearing from ford motor company dealers their consumers did not want to buy our cars. 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 reengage 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. we engaging with the ford family was easy. bill ford and his mother, martha firestone 40, are among some of the most amazing people i know. they were happy to reengage.
we two years ago elected henry ford the third, the grandson of henry ford the second, 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 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. he mentioned the two terrific
ones like what jeff bezos is doing as well as mckenzie scott. 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. 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? darren: 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 any this
country, there is a civic imperative of the individual to do what he or she can to make a difference in improving our community. i celebrate those small impactful donors. 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. it is that calibration that concerns me. david: you and i serve on the national gallery of our board. every art institution in of once you to serve on their board. what is it about art that attracts you? darren: art is essential in
democracy. art is so important. we know what art does to young people. no that exposure to art brings about -- we know that exposure to art's higher levels of empathy. it helps other people understand how other cultures live. it rings out the humanity -- it brings out the humidity 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. 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.
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