The Gates Foundation: Giving Away A Fortune

With plans to give away $60 billion, Bill and Melinda Gates have now become the most generous philanthropists in the world. What would you do with $60 billion?

Well, the Bill and Melinda Gates Foundation wants to make American kids among the best educated on Earth, and while they're doing that the Gates also intend to save millions of lives worldwide. The foundation has been running for ten years.

The Gates have shunned publicity for the most part. But, recently, Melinda Gates agreed to travel around the globe to show "60 Minutes" how they're giving a fortune away. And with a world of trouble, what was the first thing she wanted us to see? The north of India, where it is a short drive from the big city to the Middle Ages.

In the countryside of India's most crowded state, Uttar Pradesh, often, food is scarce, electricity nonexistent, women and infants die in childbirth, and medicine remains in the realm of superstition. It's exactly what Melinda Gates is looking for - a neglected crisis where her investment can save the most lives.

Asked what the foundation's global priorities are, Gates said, "HIV/AIDS, malaria, mother-and-child deaths, in that order."

"Why those?" Pelley asked.

"When you looked at where the largest number of deaths were on the planet, they were from things like AIDS, malaria and these childhood deaths. And nobody was giving voice to them. And no one was really tackling them. So, we said systematically, 'Those are places that we wanna go and work,'" she explained.

It might be occurring to you right about now that you haven't seen the world's richest woman before. She's not the type to stand on a red carpet with million-dollar earrings. Melinda Gates, 46 years old, from Dallas, is a former Microsoft executive who managed 800 people in software development and marketing.

Now, the work of the foundation is her obsession. This trip with "60 Minutes" wasn't a "photo-op." In fact, it took a year to convince her to let us come along. She travels often, probing for facts, analyzing needs, measuring the misery.

"I have to be here. To see it, and to feel it, and to understand, you know, what motivates these people. What is it that they're doing for their livelihood? Unless I see it and feel it and touch it, I just don't feel like I can do the foundation justice in terms of what we're trying to accomplish," she explained.

What she's trying to accomplish in India is saving lives at birth. In India alone, one million babies die every year before they're a month old.

"I wonder which ladies in this audience have lost a child shortly after childbirth?" Pelley asked a group of villagers.

"Oh, look at that. 1, 2, 3…16. It's a common experience in this village," he noted, after a lot of hands went up.

This is a great example of exactly how the foundation works. The foundation poured money into research to understand the problem. It found that, by tradition, childbirth is considered unclean there. Babies are often left on dirt floors, uncovered, while the mother is tended to first.

The foundation tested solutions, trained health care workers to use sterilized tools and taught the mothers to keep the baby warm; simple, inexpensive ideas that have reduced deaths there by half. Part of the foundation's strategy is to team up with governments and other charities to make the money go farther and spread the best ideas.

"These deaths of children under five have come down substantially; 1960 it was 20 million under the age of five that died. Now it's nine million children. That's still too many," Gates told Pelley. "Every year, nine million children die. We can get that down."

As for those other priorities she mentioned, the foundation is working on a vaccine for HIV and nothing less than the eradication of malaria and polio, taking on everything at once.

Melinda Gates is analytical and driven, not unlike her husband. She likes hard facts, strict accounting and expects everyone around her to measure up - very much the CEO.

She talks about spending a billion here, a billion there, and you realize that billionaire philanthropists aren't like you and me. There was a funny moment when she was going through some figures and in an uncharacteristic slip she said she'd pledged one billion to vaccines when it's actually ten billion.

"You know, it just occurred to me you had misplaced nine billion dollars. Now, I misplace change at the end of the day. But you had actually forgotten about nine billion dollars," Pelley pointed out.

"I think I missed a zero in there," she replied.

"Most people would remember that kind of a number," Pelley said.

"You know, for me, I think more about the possibility of what it is we're trying to change. So, if I have to go around the health statistics in the world, I don't tend to get those wrong. But the amount of dollars we put in, I'm always more focused on what's the result we're gonna get, no matter how much money we've put into the issue," Gates said.

"Now I'm from Texas too, so I can say this. You don't wear your wealth like a Dallas gal. You don't seem to be a big consumer of jewelry and cosmetics," Pelley remarked, referring to Gates' toned-down style.

"I don't find great joy in those things. I find much more joy in connecting with people. I'm much more at home being what I call 'out on the ground,' doing this work. And for me, that's where I find meaning. I don't find meaning in material things," she replied.

One village they visited had nothing material to give but music.

"You know, it's a long way from Microsoft," Pelley said.

"And I like this a whole lot better," Gates said.

Some 7,000 miles away, back home in Seattle, the Bill and Melinda Gates Foundation is building its new headquarters. There are 850 employees figuring out which science or development projects are worthy.

And listen to what they have spent already: $4.5 billion for vaccines; almost $2 billion for scholarships in America; and $1.5 billion to improve farming in Africa and Asia, just to name a few. The foundation's wealth ranks up there with America's biggest companies, just behind McDonalds and ahead of Boeing.

"Boy, his and hers offices. I'm not sure a lot of marriages would survive this," Pelley said, touring the Gates' workspace.

"Oh, it works out great," Bill Gates said.

"Well, we actually like it a lot," Melinda Gates added.

The Gates live in a secluded hi-tech mansion with three children. The kids are now ages 8, 11 and 14. Bill and Melinda met at a Microsoft meeting 23 years ago.

"What did you think? I mean, it is not everyday a girl gets asked out by the richest man in the world?" Pelley asked.

"Oh, no, It wasn't that, it was that I didn't think it was a very good idea to date the CEO of the company," she replied.

It was back in 1993 on a vacation in Africa that they began to think about giving away their money.

"Well, if you have money, what are you gonna do with it? You can spend it on yourself, you can have, you know, thousands of people holding fans and cooling you off. You can build pyramids and things. You know, I sometimes order two cheeseburgers instead of one. But we didn't have any consumption ideas. And if you don't think it's a favor to your kids to have them start with gigantic wealth, then you've gotta pick a cause," Bill Gates explained.

"You don't consider it to be a favor to your kids?" Pelley asked. "To give them enormous wealth?"

"No," Melinda Gates said. "They should go on to pursue whatever it is they want to do in life and not feel cheated by that by being given something, given a whole lot of wealth. They would never go out and figure out who they are and what their potential is."

Melinda Gates told Pelley they told their kids that they are giving most of the money away and that their children are okay with it.

"Yes, they reach different ages, they may ask us again, 'Tell me again, What? Why?'" Bill Gates added.

The Gates' kids will still be massively wealthy. But their parents have already given roughly $30 billion to the foundation and they told us they'll give ninety percent of their money away. Add to that the contribution of the Gates' close friend, Warren Buffett, who has committed another $30 billion to the foundation.

This past summer, the Gates and Buffett challenged billionaires to give half of their wealth to the charity of their choice. So far 40 have signed the pledge.

"The foundation, you, have made certain choices about what you're going to fund. And some people might ask, 'Why not drop 30 billion dollars on a cure for cancer,' for example," Pelley remarked.

"Well, there's a huge market for cancer drugs. And there's dozens of pharmaceutical companies that spend tens of billions on those drugs. In malaria, when we announced a grant for $50 million, we became the biggest private funders. And so, the fact that it kills over a million children a year and yet has almost no money given to it, you know, that struck us as very strange. But it became the thing we saw, 'Okay, this will be unique. We'll take the diseases of the poor, where there's no market and we'll get the best scientists working on those diseases,'" Bill Gates explained.

"You're trying to find the places where the money will have the most leverage, how you can save the most lives for the dollar, so to speak," Pelley remarked.

"Right. And transform the societies," Gates replied.

Another society they want to transform is America's, particularly through the schools. They've pledged nearly one quarter of all the foundation money to American students. And we followed Melinda Gates to the Friendship Collegiate Academy High School in Washington D.C.

"I wonder what you think is the most alarming thing about American education?" Pelley asked.

"I think it's most alarming that we're only preparing a third of the kids to go on to college. That's a frightening thing for our democracy to say a third of kids are prepared to go," she replied.

If only a third of high school seniors are academically prepared to go to college, the Gates believe that a revolution in teaching can go a long way toward pushing that up to 80 percent. They're funding research to figure out what makes great teachers great.

The foundation is at work in schools in nearly all 50 states. At Friendship Academy, they've given nearly a million dollars to the "Early College Program."

Juniors take college courses. The money hires teachers, buys books and takes the students on college tours. Last year, 100 percent of Friendship Academy's seniors got into college.

Sort of like "national parents," Bill and Melinda Gates have helped pay college tuition for 20,000 American kids.

"The country is built on ingenuity. It's built on having lots of very well-educated people. And if you were from a poor family, how are you going to be break out of that? Well, education is the only way. Education is the thing that 20 years from now, will determine if this country is as strong and as just as it wants to be," Bill Gates explained.

One of the boldest efforts of the foundation is unfolding in the slums that we visited in Delhi, an attempt to eradicate polio. No one in America has seen this since the 1960s. We found, in a Delhi hospital, a polio ward full of paralyzed children.

"This young boy, Sahil. He is ten years old. Sahil has got paralysis of one side of his body. One leg. See what he's doing, he's trying his best, he's bringing his hand, but he cannot move his leg," a doctor explained.

In a country where water often runs next to sewage, the virus, which is spread through human waste, finds new victims. Polio has been cornered to just four countries on Earth, so the Gates have teamed with Rotary International to bang on every door to find the last child who hasn't tasted the vaccine.

"Do you believe you can do that, actually eradicate the virus from the face of the Earth?" Pelley asked.

"It's been done with smallpox. And that's what gives us the hope and the belief," Melinda Gates said.

While in India, we were invited to a ceremony that every new mother prays for. Because so many newborns die, they're not given names right away. One family had waited a week to bring their daughter into the light and name her "Durga," which means "Invincible."

It was during the ceremony that we saw what it is that has moved a no-nonsense executive to give away her fortune.

Durga's first blessing was from the sun. Then she received a second, a future free of polio, in the form of a vaccination.

Produced by Denise Schrier Cetta