“The richest will always be able to protect themselves,” said World Bank Group President Jim Yong Kim. But there’s a lot that tech execs and other elites can do to help solve the problems of tomorrow.
“Your children will ask you, ‘How could you leave that kind of world to us?’” Kim said on the latest episode of Recode Decode, hosted by Kara Swisher. “If the tech industry thinks the questions being asked now are tough, wait until the questions come about inequality, about ‘you guys have stoked the aspirations of everyone in the world and then taken all of their jobs away.’ We don’t want that to happen, and we know the leaders don’t want that to happen.”
Fortunately, Kim said, some companies are stepping up on issues like education, medicine and climate change. And he’s optimistic that the assistance of Google, Amazon and Microsoft could make famines a thing of the past.
“There are five stages of famine,” he said. “The United Nations doesn’t call it a famine until it reaches the fifth stage, but it’s the first stage where you’ve really got to take it on.”
So, those companies are partnering with the World Bank, the UN and the International Committee of the Red Cross to help them take action sooner; the plan is to use data about floods, droughts and migrations to intervene in vulnerable areas before the famines can start.
“The World Bank can come in and move some of the money there ahead of time,” Kim said. “And then, at the end of the day, we might also create an insurance-type instrument. So, bringing together technological innovations with financial innovations could actually stop famines from ever happening again.”
“Famine by definition is large numbers of people who are starving to death,” he added. “There’s no reason for that to ever happen. There’s plenty of food in the world to stop that from happening, and this is going to be very exciting. It’s going to be a very exciting process, and to have the tech industry involved early on is great.”
Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Jim.
Kara Swisher: Today in the red chair is Jim Yong Kim, the president of the World Bank Group. It’s one of the three big international organizations that just launched the Famine Action Mechanism, which is a new program dedicated to preventing future famines. And they’re going to be doing that with support from Microsoft, Google and Amazon. We’re going to talk about that and a lot more. Jim, welcome to Recode Decode.
Jim Yong Kim: Thanks, Kara.
So I’m here in Washington DC, I’m at the World Bank, which is your building on H Street, not far from the White House, or anything else. People in Silicon Valley — and we have a bigger audience than that — don’t really know exactly what you all do. So let’s first talk about how you got here, and then where the World Bank is right now. And then we’ll move into these programs.
The announcement that I would be the U.S. candidate to take this job was a surprise for everyone. It was a surprise for me. Twenty years before, in 1994, I was part of a movement to close the World Bank. We called it “Fifty Years Is Enough.” The idea of the movement was that the World Bank had so ignored things like human development, that had been so focused on just GDP growth, that we thought, that on the fiftieth anniversary, 1994, they should just close its doors.
I was president of Dartmouth College at the time, and Tim Geithner, who was a Dartmouth graduate, called me, and said, “Hey, would you be interested in being a candidate for the presidency of the World Bank?” I said, “Tim, I edited a whole book that said it should be closed, as part of a movement.” He said, “Ah, that’s not a problem.”
I still, to this day, believe that if it hadn’t been President Obama, there’s no way that I would have gotten this job. Because I walked in the Oval Office, because he interviewed me, and he said, “Why should I nominate you?” My first words, “Well, have you ever read your mother’s PhD dissertation?” He looked at me and he said, “Well, yes, I have.”
She was an anthropologist, and when he burst on the scene in 2004, I learned that his mother was an anthropologist, and so I got her dissertation from the University of Michigan archives, which is where all unpublished dissertations go. I read the whole thing, and I said, “Just like your mother, everyone predicted that the artisanal industry in Indonesia” — where she was doing her work — “would collapse under globalization.” She showed that it actually flourished.
I said, “That’s what I’ll do. I’ve been on the ground, doing development work for 30 years. I’m not going to be able to give you the 30,000-foot view of macroeconomists, but I’ll tell you if things are working on the ground.” He looked at me, and he said, “I get that.”
Two days later, I was in the Rose Garden and he was announcing that I was the candidate. It was just a very special set of circumstances that got me here.
Well, what is your background? Talk about your background, what you’ve done, so we know.
I’m a medical doctor and also an anthropologist. I was born in Korea. My parents, though, met and married in New York City. They were among a couple hundred Koreans who, because they were good students, were able to come and do some training here. There were literally a few hundred Koreans in all of the United States.
They met, they married here. My brother was born here, and then [they] went back to Korea, intending to stay. But what’s happening all over the world right now is people’s aspirations are going up, mostly by looking at their smartphones.
For them, it was a very direct experience. They saw what life was like the U.S., and so when I reached the age of 5, we came back to the United States. I grew up in Iowa, of all places.
Of all places.
And then ended up going to medical school, because my father didn’t ... couldn’t stand the idea that I would study philosophy and political science and become a politician, which is what I really wanted to do. And then did anthropology, and then met this guy — my lifelong friend, named Paul Farmer, out of all of our adult lives, anyway — and we created this organization that began working on healthcare programs in some of the poorest places. Haiti, in the slums of Peru ...
These intractable, healthcare problems.
Yeah, intractable places. Tackling intractable problems. And Partners in Health has just been hugely successful. So I was doing health and education work on the ground forever, and then, just these crazy jobs kept being offered to me. One was to be the head of HIV Department at the World Health Organization, and there we started a movement to treat HIV. It’s hard to understand. Back in the late 1990s, when we had these miracle drugs, which were just really extraordinary ...
They changed the face, yeah.
They entered highly active antiretroviral therapy. It was really the Act Up guys. It was a very small number of people, who said, “Now that we’ve put our bodies on the line, and we’ve got these drugs, there’s no way that we’re gonna let people say, ‘Only the rich can have it.’”
So it was them and Partners in Health and literally a handful of others who were saying, “Everyone in the world should get access to these drugs.” So I went to the World Health Organization. The World Health Organization had been very much, standing on the sidelines, not arguing for HIV treatment. I started a movement there called 3 x 5, to just accelerate HIV treatment. Now, 20 million Africans are on HIV treatment.
But the whole world, including a lot of leaders in tech, were saying, “Ah, HIV treatment in Africa’s not possible,” and I kept going around saying, “Are you kidding me? There’s 25 million people living with HIV in Africa. If we let them all die because treatment is too complicated, we will always be remembered as a generation that did that. It’s gonna be that bad.”
And so, the world changed. We had success. I left WHO. The folks at Dartmouth came along, asked me if I’d be interested in being their president.
Running a university?
I’d never thought about doing something like that before.
But I thought, “Well, what an opportunity? If we can influence all these young people to think about poverty and to think about inequality, that would be great.” It didn’t take very long for me to realize that was actually not the job of being president of Dartmouth.
No, it’s fundraising.
And then, three years later, Tim Geithner called me. When Tim called me, I thought he was just trying to see if one of his friend’s kids might get into Dartmouth. I had no idea that that would be the case. That was my ...
That was your other job. That was your second job.
That was the other job. But, so, here I am, and I had known that the World Bank has changed a lot. One of the great things about the World Bank is, we’re really data-driven. And it comes from my medical training. And I know you have doctors in your family.
Yes, I do.
It hasn’t been that long where we have done things only on the basis of evidence. There’s still so many things we don’t know, but the World Bank has really adopted that evidence-based approach. For example, the World Bank’s approach to health and education changed dramatically over the last 20 years, because they realized that all the evidence suggests that more investment in health and education can lead to better economic growth.
So you shouldn’t think of it as two opposed things. You invest in roads to grow the economy, invest in people when you can. All the evidence suggests that it’s the countries that invested in their people, before ...
In their people, and education, which has been the focus of a lot of tech companies and tech leaders, who have all the money.
That’s right. Absolutely.
So, how many people work here now, at the World Bank?
You know, 15,000 permanent employees, probably about 25,000 ...
It’s frequently under attack politically.
For doing things, and it has its ups and downs. What are the big challenges you face right now, coming in?
Well, right now, today, is the specter of what’s going to happen in the economy. So there are places that we’re worried about. There are countries like Turkey, that have a lot of dollar-denominated debt, and there’s also just tons of uncertainty. We don’t know how these trade discussions are going to go, that trade has been really good for poor people.
I mean, that’s something that’s not raised very much, but the more that is traded, and the more that ...
Poor countries and poor people are involved in trade, the better they’ve done. China has lifted almost a billion people out of extreme poverty, and they’ll tell you that trade was a huge part of it.
That, their ability to participate in trade, so we’re worried about that. We’re worried about places like Venezuela that, if they become much more unstable, the effects on other countries and even the global economy could be huge. So we’re worried about that.
But I tell you, the biggest thing I’m worried about is, what people are going to do in the future. Jack Ma tells this great story. He says, “You know, my grandfather worked 16 hours a day, six days a week. He felt very busy. I work eight hours a day, five days a week, and I feel very busy. My kids are gonna work three hours a day, three days a week, and they’ll feel very busy.” I like to tell Jack, “Well, Jack, your kids may not be working at all. You’re in a different position.”
Right, right. You know that that’s a big topic that we talk about a lot.
That’s a big topic. And so, I’m worried about the fact that, on the one hand, the future of work is changing quickly. How quickly, I don’t think anyone knows. Certainly, it’s going to change quickly in the U.K. and the U.S. Those are the places where we think automation and artificial intelligence will have the biggest impact.
But in developing countries ... Bangladesh, which is famous for the garment industry — and the garment industry has always been thought of as the industry that always will require human hands — garment industry owners are buying these things called sewbots, S-E-W-B-O-T-S. And 3-D printing now can make shoes and shirts faster than human hands.
And so the big question for me is, okay, so, we always say, “Well, the Luddites were wrong.” And the Luddites were wrong because each new phase of technology created new jobs. And so the question for me is, “Will countries be ready, will their populations be ready, to tackle those new jobs?”
Will this country be ready? Will it be Europe?
Yeah, will this country be ready? Will any country be ready? But if you look at places ... Indonesia has 37 percent childhood stunting, India 38 percent, Pakistan 45 percent, most of Africa has about 30 percent childhood stunting. What we know about childhood stunting is that, it’s a very simple measure, two standard deviations below height for age. And so, we have so much better studies that the imaging now shows that these children have as much as 40 percent less brain volume and far fewer neuronal connections.
We’ve done independent studies of children who are stunted, and they learn dramatically less in school and they earn dramatically less when they get into the workforce. When I look at these situations, 35-40 percent childhood stunting, and also school performance isn’t good either, the question is, what are these people going to do?
I mean, if the low-skilled agriculture jobs are taken over by automation ...
What are people going to do? At the same time, if the folks in Silicon Valley who are my friends say, “Look, 2025, 2030, everyone’s gonna have access to broadband.” While everyone may not own a smartphone, they’ll be able to look at a smartphone.
Someone around them will have one.
And so, the process ...
Everybody will own a smartphone.
Everybody will. Probably, right?
The process that my parents went through, that very few other Koreans went through, in the 1950s, they saw what life was like in the U.S. and they aspired to it.
They learned how to speak English.
Those aspirations are going to go up. We, in a very nerdy way, we actually studied this. We said, “Well, what happens when you get access to the internet?”
Well, let’s talk about why people ... this is a big topic, and I do want to get into some other announcement you’re making, but this is, to me, the biggest topic going forward for the world, in terms of what jobs are going to be in the future. You guys are doing an initiative, correct? Explain what you’re doing around that.
Every year, we publish something called the World Development Report, and it takes on different issues. This year is that the World Development Report is on the future of work.
What comes out of it is that, look, it’s not all doomsday in the sense that the rapid automation that’s going to happen in the richest countries, especially the U.S. and the U.K., will probably happen slower in developing countries. And so, what’s the percentage of jobs that will be lost over the next decade or so? We estimate between 5 and 12 percent, but we also say that we actually don’t know.
You don’t know.
Because things could happen very differently.
And those jobs could go away much more quickly.
Because there’s a series of things. It’s not just automation.
It’s automation, robotics, AI, artificial intelligence, changes in driving, in terms of transportation, in healthcare, delivery, in printing, in manufacturing, it just goes ... it iterates through the system, in a way that people ...
That people, I don’t think, understand, even in the developed world. Most of the people, interestingly, in Silicon Valley tend to say, “Well, it’s like farming to manufacturing. It was better for everybody.” How are you all looking at that? Because I don’t necessarily think it’s going to be better.
We don’t know. We don’t know where the jobs are going to be.
So, all over Africa, I talk to heads of state. They, and the ministers of finance, tell me, “Well, you were born in Korea. We want to go through the same thing Korea went through.” Because South Korea, when I was born in 1959 in South Korea, the World Bank would not give a loan to South Korea because they thought it was hopeless. They literally said, “This is a basket case. It’s hopeless.”
Literacy was about 25 percent. All of the industrial capacity and minerals were up in the northern half of Korea. It was this sort of gentleman farmer part of Korea, so they said, “This is an all-agricultural economy, how on Earth are they gonna grow?” So, for fear that they would never able to pay back a loan, World Bank wouldn’t give them any. Right?
And so, what did they do? They went from agriculture to light manufacturing, literally, from human hair wigs to black-and-white TVs, now to silicon chips. But if you ask the Koreans, they’ll tell you that path is probably now closed. The question is, is it closed to all of Africa? Well, you don’t see huge amounts of industrialization in Africa.
And yet every African head of state, minister of finance, tells me, “We’re building an industrial park. It’s gonna be a special economic zone.” It almost feels cruel to tell them, “I don’t think that’s gonna happen.”
And therefore, if that’s not going to happen, what are you going to do? Well, with the internet connection, maybe your citizens could go online and be part of the service economy.
Right, coding, or ...
But if you have 35 percent stunting, and one study in East Africa showed that in looking at grade school teachers ... up to sixth grade, primary school teachers, only a third could pass the second grade competency exam.
So the teachers can’t teach.
Teachers, right? And so, this is all part of the sense of just enormous urgency we’re feeling right now to get on this task of trying to prepare these countries for what might come.
Now, China’s so interesting to me, because you’ve got the Alibabas and the Tencents of the world who, for lack of a better word, have kind of democratized the access to capital. I mean, Jack says, “We can give up to one million RMB” — which is about $160,000 — “and get it in your account in two seconds without ever meeting you, without ever shaking your hand.” The so-called KYC, Know Your Customer rules, have completely changed. We know from their online behavior how much money they can handle.
So, if you’re an entrepreneur ...
These loans, they make quickly.
That’s right, and you’ve shown that you can handle that much money, you push a button, two seconds, it’s in your account. And then, because it’s in their interests for you to be successful, Alibaba helps you with access to markets, with access to accounting. They’re doing their accounting on the Alibaba website, to supply chains. They market for you if your product is doing well.
So there’s that, but then, there’s also Shenzhen, which is the most robotized, AI-driven industrial area that I’ve ever seen. They have all of the different possible futures of work in China, and we’re now trying to see if we can transfer some of those to Africa.
So what if the African continent, instead of going from light manufacturing to heavy industry, goes from agriculture to small and medium enterprises that have access to capital, have access to mentoring? That people help them start their businesses, they create jobs, and then they sell their products all over the world. That’s one possibility. Other possibilities are, tourism is extremely job-intense. There’s a lot of jobs in tourism. We’re looking at all of the areas that could potentially work, but ...
Which is ...
The answer is, we still don’t know.
We still don’t know. One of the things we do know, that I talk about a lot, is that every single job that can be digitized, will be digitized.
That’s what people don’t know, that don’t understand. I don’t think governments do, including this one.
Well, Jack said something really scary. He says, “It’s not just the muscle power jobs that are going to be automated.”
All of them.
The brain power jobs are going to be.
Radiology, right? And then ...
Yup. Don’t be a radiologist.
They’re, if they’re, that’s actually ...
I always say that to mothers.
It’s going to be, if not already, right?
Yeah. We’re talking with Jim Yong Kim. He’s the president of the World Bank Group. We’ve just been talking about work, and you just visited Silicon Valley. This is the thing I bang on them a lot. What are you going to do about it? And the only reason I do is because I know them and I can’t make government do it. I want to assess government in a second, but talk a little bit about your trip there. You just were there and you’re talking about a bunch of initiatives that you’re doing. Talk about what that was like.
So, the two companies I spent the most time with were LinkedIn and Airbnb.
One around jobs, one around jobs.
And Jeff Weiner, the CEO at LinkedIn, has been an incredible partner for us. He learned about the work I did from a book about Paul Farmer, the guy I started the organization with, and so he’s been trying to bring these ideas ...
What we’ve learned, though, is that just about every tech person I know, if you ask them, “Would you like your technology to be applicable in the fight against poverty?” They all say, “Yes.” But then the other thing we’ve learned is, unless you start thinking about the applications in poor countries very early on, it’s going to go in a direction and it may or may not — but most likely not — [be] very applicable in developing countries.
For LinkedIn, the stuff we’re doing with them is so cool because it turns out that they have so much information on the kinds of skills that are needed, the kinds of skills that are present in any given country and where the skills are moving that we’re now going to use this country by country to help planners, and mostly it’s going to be ministers of finance and others plan for how they can get a better match between the skills they have and the skills they need. And also what kind of skills training they need to do.
With our group that is in charge of the Middle East and North Africa, they just did a very simple thing and they said, “Okay, so where are the skilled people from that region going and where are the skilled people in the region coming from?” That in itself was just so interesting for us.
Do they have this data?
Just getting a sense for that. So what we’re doing with them is extremely exciting and for me, because of their leadership, Jeff’s leadership, their commitment to it, I think we’re going to have an impact very soon.
So doing what, precisely?
So this is specifically for understanding what is the skill mix in your country, what are the skills that are needed in your country and what can you do to actually improve the skills and prepare your workforce to be able to fill those needs?
The other thing though, too, is that within Africa, people are going to be moving around, and so if we find that there’s an overabundance of skills in one area and the need for them in another, then we can do this kind of matching that should work.
Airbnb, again, Joe Gebbia has been really passionate about this. It’s complicated, because when you have a disruptive of technological innovation like this, every individual country has to figure out how they’re going to regulate it. And so we’re working with the countries to help them make sure that this is beneficial to them. But tourism is an extremely labor-intensive industry.
You said, yeah.
And when you go from ... They’ve been able to set up shop in places like Soweto in South Africa, and so when neighborhoods then become placed destinations for tourism and the people from those destinations can tell their story and then make an income, it’s actually a very positive thing.
From things, not just from experiences, for the other things they’re doing there.
That’s right. So they provide the experiences, but then they become business owners and they start hiring people. We think that tourism has to be a huge growth industry. Chinese tourism, there are more Chinese tourists than any other tourists in the world. And right now it’s relatively limited. I mean, Chinese are ... people still are putting lots of money into savings, we look at a country’s savings rate. So how much, how much do people save? The U.S., it’s like a negative.
People are in debt. China, it’s still 40 percent of GDP. And part of it’s because they’re saving because they don’t think that they’re going to be taken care of in the future, what China is developing, all of these social security-type programs. And so a lot of that, more of that money is going to be used and we think for tourism. So as that grows, countries can become much more engaged in tourism. Of course, there’s a role for hotels and other industries. But this ...
Is small businesses.
That’s right, brings small businesses into the picture. But part of it is we’re trying to discipline ourselves. And the reason is because, I keep telling this to one of my good friends in the bank who left a little while ago, said, “You know what, Jim, 30 years ago we had an argument about whether to build telephone poles in India.” And it was a heated argument. They were very strong opinions on both sides and luckily we decided not to invest in telephone poles in India. But my question now, every day I ask, “Okay, are we doing the equivalent of building telephone poles in India, somewhere?”
And I have to believe that we are. And so now ...
What do you think that is?
Well, I’m not sure, but we’re not looking around corners like folks in Silicon Valley are, right? Four or five of our major units did their retreats out there and are going and visiting LinkedIn and Airbnb, but also working with folks at Singularity University, trying to get some sense of, what are we missing here. But the other thing is, we’re trying to bring the problems we face and put it in front of tech leaders.
So one of the things they do is, I do like to get involved in things like that, but some people blame them for these trends, for the automated ... They’re inventing that things ... I just wrote a piece this week about Marc Benioff buying Time and I said, “Those that are killing us, they’re saving us like.” They killed the media this way and now they’re using their money to save the media, which is kind of interesting when you think about it. It’s the same thing with tech. A lot of these, Google, AI, Uber, all the others on self-driving, tons and tons of Google. Again, social media impacting everything. How do you look at this? is it just we’ll have to engage because these are the inventors of the things that are the problems you’re about to face?
So how do you engage them?
So, Marc is someone I know, we serve on a board together and I know Marc really cares.
Benioff. Right. Marc really cares about education in the United States, for example.
I’m not blaming Marc for most of it, because it’s just Salesforce.
He really cares about education in the United States, he’s thinking hard with all his creativity that he brought to his work. He’s trying to think about how to make it better. And so, again, this is my medical training. I’m trying to be evidence-based. And this is not a time to sit back and think that our judgments are gonna help. So my collection of evidence to date has been that these folks have been incredibly creative and they haven’t been thinking ...
No, they haven’t.
... about all the side effects of what they do.
So now they have to, and I think that’s a good thing. We feel it’s our job to continue to bring the problems we face every day — extreme poverty, the fact that food insecurity affects a couple billion people in any given year, that there’s so much child stunting, there’s so much terrible schooling out there — we try to bring our problems to them and then are finding ways to use the technology and get them engaged so that they can make it work for everyone. Sal Khan, one of my heroes. And Sal, I just made an offhand comment to ...
Explain who Sal is.
Sal Khan is the Khan Academy.
I think Sal is the best teacher in the world. I mean, the way Sal explains things and his materials are so simple, so straightforward, but they’re using AI in such interesting ways that if you show that you like to learn a certain way — more visually, more words, sound, whatever — then he gives you more information with that knowledge, that’s built on an AI system. And so I’m so impressed with this that I just made an offhand comment to the ruler of Dubai, Sheikh Mohammed Bin Rashid ...
Offhand, just hanging with the ruler of Dubai.
Well, Sheikh Mohammed Bin Rashid is incredibly innovative. And so I said, “If you just translated all of Sal Khan’s materials into Arabic, that could actually improve the quality of education throughout the region.” So he did it and it took a year and a half. He had 7,000 people working on the translations and I don’t know how much it cost, but it took a huge number of person hours, but it’s done. And so I think that was the step needed to be taken. Carlos Slim has translated them into Spanish. Another great story: There’s this company called Zipline, one of my favorite companies.
Yes. We’ve had them onstage in our events. This is drones, explain what they do.
So, Zipline, I mean, these guys are literally ...
It’s blood delivery, right?
Yeah. They’re rocket scientists. I mean, they’re literally aeronautical engineers and they met with the folks in Rwanda, and Rwanda had a problem with delivering blood. And so they literally built planes and systems.
This due to bad roads and all kinds of ...
Right. Roads, it requires a cold chain and you have to keep the blood cold over a long period of time. You can try to keep the blood at the clinics but it’s a huge endeavor. And so they figured out how to use drones in Rwanda to deliver packages.
Which by the way is very hilly and ...
It’s very hilly. And it’s so cool. I mean literally it’s a big rubber band with something that looks like a plane that’s run on solar energy. It takes off. And then there’s a box with the blood, it’s packaged and they drop it from 30 feet with a little tiny parachute. It falls, they use it.
I was so excited about this, I started talking about it with other African leaders and now I think they’re in like 15 different countries. They’re talking to the Indonesians right now — Indonesia with more than 10,000 islands. This could be a great solution, but it took Keller and Otto and his team, they had to go to each country and see how what they were doing would be applicable in that setting and that was the key.
It wasn’t that they were aeronautical engineers, it was that they were aeronautical engineers who spent enough time in Rwanda and now Tanzania, Indonesia, other countries, to be able to adjust this technology and make it work in any setting. And so, that’s my invitation to all your listeners. Right? We are very happy to help you begin engaging directly in specific problems. We have the presence on the ground, we understand the economics of it. We’re a tech sector expert.
This are things that governments used to do, that governments are supposed to do and stuff like that. And I think some of the, just even in this country our initiatives around jobs and STEM are so weak and so not developed. I can’t imagine they’re developed everywhere. I mean, they are in China. They are absolutely — China is accelerating so fast past the U.S. and other countries. I mean, I don’t say there’s not a need for government, but a lot of things that government used to do now the private sector ... Is that a comfortable thing?
Well, we’re trying to understand that, the key is to get the outcome.
Yes of course, absolutely.
We’re trying to be agnostic and I’ve talked a lot about how it might be the right thing to do to bring the private sector in more in areas like education, health, and I’ve been criticized for it, but the question I’m asking ...
Explain the criticism.
Well, the criticism is, well, these things have to be delivered by the public sector. You’re not respecting teachers’ unions, etc.
Yeah. You remember also the controversy when Microsoft tried to deliver, when they did the one laptop per child, that just sort of fell apart.
The one laptop per child was a great idea.
Really beautiful idea.
But what they learned from that was it’s not the hardware, it’s actually the software, which is why I’ve been so focused on the Khan Academy as opposed to the hardware.
That these devices become so inexpensive like phones and you do everything with your phones.
Oh yeah. And everything is going to happen on smartphones now going forward.
Yeah, it’s interesting. About 10 years ago I kept saying everyone will have a smartphone. It will be like a computer in your hand. And they’re like, “they can’t afford them.” “These things will cost nothing, almost nothing eventually.”
“And this is how they’re going to deliver things.”
That’s what it looks like.
But the public-private message, for me, I have a PhD in anthropology in the 1980s and we all thought that the battle between socialism and capitalism, we didn’t know where that was going to go. We all thought that socialism might prevail and it just hasn’t. And so the questions we’re asking here are, what is the evidence? Is there evidence that educational systems in poor countries in Africa will disrupt themselves by just putting more money? And the evidence is not good that that’s going to happen.
And so the question for us is can private-sector entities that are doing it for what the governments can actually afford, can they disrupt the system and bring quality in? And I’ve been arguing that we have to be open to that. Now, we’re actually studying those solutions. But, it’s funny, my colleagues in global health and global education are, I think, looking at me now saying, “Well, what direction are you going?” And here’s what it is: We spent so much time lobby rich-country governments to provide more financing for health and education — and not as much in education, but in health, my goodness, what President Bush did with PEPFAR, Bono’s work, the Global Fund. There’s so much more money.
When I started in Global Health, there was a couple hundred million a year. Now there’s 25 billion a year, but that’s not nearly enough. And where we’ve come to is that now many heads of state and ministers of finance are hiding behind that, and they’re sitting back and saying, “Hey, look, if you give us grant-based money, we’ll spend it on health and education, but if you don’t, we won’t.” And they see these grants as a way of taking the money they normally spend on education and putting it elsewhere.
Now, we have overwhelming evidence that your investment in people, what we call investments in human capital, are absolutely determinative of whether your economy’s going to grow. I mean, Korea, China, Vietnam, Japan, all of the East Asian countries, they invested in education before the World Bank thought they should, right? Korea, second loan from the World Bank was for education and they were ridiculed for taking a loan for education. But now we know that they knew something back then. And everyone else is playing catch-up.
And so what we’re going to do, I keep asking donors to give more. It’s important to give more, but it’s nowhere near enough to meet the need. And so we’re going to rank countries, we’re doing a human capital index. Now, we do something called the Doing Business Index and that the week after the Doing Business Index comes out is my busiest week because all of these heads of state, ministers of finance are calling me, it’s like yelling at the refs.
Yeah. You’re like U.S. News and World Report College Issue.
It used to be your thing right?
People think that yelling at the refs is effective. And so they yell at the refs. I learned something from that, though, that people pay attention to rankings that come out from the World Bank Group.
So we’re ranking countries based on the quality of their investments in young people.
We’re looking at what we call learning-adjusted years of schooling because we now have a much better idea of whether kids are learning in school. We’re adding childhood stunting, which is hugely important.
Under-5 mortality. Are kids living until the age of 5? Overall mortality. How healthy are they between the ages of 19 and 60? So those are really clear indications of the quality of your job market of the future. We’re ranking countries.
And therefore companies can go into them.
It’s going to be very controversial. It is already. I’ve told my team, “Look, I’ll take full responsibility for this one. I’m doing this because I feel like I have a moral responsibility to just expose the real situation.”
Right. And what’s going on.
And then the other part of that is we’re saying to every single country, but we’re not doing this with any bad intention, we are ready to help you right now. And technology is key. We’ve got to find the technologies in health and education that will help them move much more quickly than they otherwise would. But we’ve got to create demand.
One of the programs that you’re announcing is the Famine Action Mechanism, which is astonishing that we’re talking about high-tech jobs or anything else when famine still exists around the globe.
And these solutions, it seems again into another intractable problem that doesn’t seem to go away. Talk about that, where it is and what the newest initiatives are.
Well, I’m a medical doctor and anthropologist, so when I came in here I had to really intensively study macroeconomics and finance especially, two of the areas. And also transport and IT. I had to study these things because we do all of them. And so I kept asking what everyone else thought — I think — were stupid questions: “Why can’t we do this? Why can’t we do that?”
And so when ebola happened in Guinea, Liberia and Sierra Leone, 11,000 people died. But it’s really only the infectious disease docs who know how close we were to having a global disaster. I mean, we were just lucky that it didn’t go to Karachi or Delhi and that they stopped it when it got to Lagos in Nigeria. I mean, it was a million-dollar-a-case to stop it in Nigeria, but thank God for the U.S. CDC and for the Nigerian government that got ready, because if it had spread quickly in Lagos we would have been looking at a very different outcome.
And so I kept asking: “Why did we have to wait eight months before the money flowed? Why are we waiting for the kindness of strangers?” There should be some kind of mechanism, and so I asked the insurance companies ... The reinsurance companies, the insurance companies that insure other insurance companies, I asked their CEOs. I said, “Why don’t we have pandemic insurance?’” With kind of a smile on their face they said, “Well, you know, Jim, if you can find out the annual incidence of any problem, we can insure anything.”
Yeah, they can. I was just saying that they can insure anything.
That’s right. We get a number, we go to the capital markets and say, “Hey, here’s the likelihood of — we think — this happening, and therefore you put your capital in, it will be at risk, you could lose it all, but we think it’s about a this much chance, and because of that, we’ll pay you this much interest.” And so we started pandemic insurance. We have a pandemic facility that has a big chunk of money that will automatically release when an epidemic gets to a certain level. And we went even further and got a chunk of cash that’s protecting the bond. So in other words, if it doesn’t quite reach the threshold but it’s still serious, the cash will release. And it worked.
So, they can immediately get started ...
The World Bank can easily ...
That’s right. In Congo, the first outbreak in Congo, we released, within weeks, literally a million dollars a case, which is kind of now what we think it takes to put one of these things out.
A million dollars of each case?
Per case. That’s what it took in Nigeria.
So, there’s 10 and 10 million.
Right. And that’s what took in DRC. But before, we waited and waited and waited until it got bad.
Same thing happens with famine. The response to famine, what the governments tell us is, well of course we’re going to respond to famine, but until the emaciated children appear on television ...
It’s really hard to raise the interest.
Which is just so crazy. The United Nations, there are five stages of famine. The United Nations doesn’t call it a famine until it reaches the fifth stage, but it’s the first stage where you’ve really got to take it on. And so, the question we asked was ... The question I asked was ...
Because the damage it does ...
Can we do famine insurance? And so, we were thinking about financial innovations, but it turned out that because we were asking the questions they said, “What’s really key is getting information early.” And so, we reached out to Amazon, Google and Microsoft and they said, “Hey, we’d love to work with you on this.”
So we’re coming up with a system, and we’ve been building it. Coming up with a system, an early-detection mechanism that will tell us where the areas are that looks like food security might be an issue. And so then what we can do as a World Bank is, we have money for these countries anyway, we can move much earlier and get programs going that can potentially stop famine. But it’s working with huge amounts of data, but often very difficult to collect data.
How do they help you — Amazon, Google and Microsoft?
It’s really about how to manage data, how to collect data from all kinds of sources that we wouldn’t have thought of. I mean, we’re not ... We don’t actually know all the different ways they’re collecting data, but they’ve decided to come together ...
Oh, they’re very good at it.
Yeah. Very good at it, right?
Very good at it.
Then they’ll try to sell you something.
This one is ...
No sale. I’m teasing.
I don’t know where it’s coming from, but they’re doing it with us without charging, and what we hope is that this will tell us all kinds of things about what’s happening in the poorest areas. Everything from floods and droughts to the status of particular crops to migration, movement of people ...
So, you can predict famine?
That’s right, so we can predict ahead of time. The World Bank can come in and move some of the money there ahead of time. And then, at the end of the day, we might also create an insurance-type instrument. So, bringing together technological innovations with financial innovations could actually stop famines from ever happening again. This is ... It’s very exciting.
That means you’re catching it before it happens.
Catching it before it happens, right. Famine by definition is large numbers of people who are starving to death. There’s no reason for that to ever happen. There’s plenty of food in the world to stop that from happening, and this is going to be very exciting. It’s going to be a very exciting process, and to have the tech industry involved early on is great.
How did you get ... What was the approach that they were looking for?
We were already talking to those guys anyway, and then in the process of putting this coalition together, it’s the International Committee of the Red Cross, the UN and us, various leaders stepped up and said, “Hey, this is great. We’d love to participate.”
Right. And it’s data centric?
Their work is data centric-
Early warning centric.
Early warning. So, they’re building systems?
Do you think that ... You’ve seen all the news about the tech lash in terms of the effect on the elections and things like that. Is this a way for tech to start to claw its way back? ’Cause, I mean, the change the world image of tech is always so “We’re changing the world, changing the world” when in fact they were just selling toilet paper, or whatever, or getting data so they can send you the right shoes to wear, or things like that, and collecting an enormous amount of data that many countries are worried about. The privacy issues, and things like that, because they’re using it. So, there’s always been a distrust of tech way back from One Laptop Per Child, they were trying to use it to sell software. How do you ... When you start to reach out to tech leaders, how do you think about that?
Well, again, as I said I’ve been very pleasantly surprised that tech leaders are not spending every day thinking and digging deeply into how their tech can be applicable to the Central African Republic. They’re not doing that. But they’re not equipped for that. They don’t have people who know how to do that, and partly, we think it’s been partly our fault. We haven’t spent much time out there, and we should be because, again, if you’re assuming that agriculture to light industry to heavy industry is not going to happen in most parts of the world-
We should be out there thinking what’s going to be the path of growth for these countries, then? What do they have to prepare for? And so this is why I now ... I’m going out there twice in a month, and our own people are going out there on a regular basis, because we have to have this conversation.
So far, everyone has told us that they’d like to be able to have an impact. We’ll see who’s serious. In this case, both LinkedIn and Airbnb have been very serious, have been very serious about engaging us, and Microsoft, Amazon, and Google now have been very serious as well. But it’s got to be different. Before, there was this illusion that if rich people are generous and give some of their money and start a foundation-
They’ve got a lot of it.
The problems will be solved.
But they still do exist-
They still do exist.
I mean, you’ve got the Gates Foundation, you’ve got Mark’s foundation, now you have Jeff Bezos’s foundation, each hitting a different area, but I found they largely want to run things themselves.
These foundations are important. I mean, the Gates Foundation changed my life. We got a grant early on that allowed us to tackle drug-resistant TB, and nobody else would have funded that. So, I’m forever grateful to the Gates Foundation. And Gates Foundation is actually in so many things that we’re doing, because they’re really trying to understand the whole problem. I know less about the other foundations. But I know Bill and Melinda, and they’re really trying to get their heads around the whole problem. So, this is not about charity for them, they’re trying to solve the problem, which is great.
Which is their nature.
But not everyone’s like that. So, for so many generous people it starts out being about their generosity, and it can’t be. It’s got to be about solving the problem, and I think tech people are going to be better at that. They’re going to be good at that. If I tell them it’s not about just giving more and more to charity, it’s about you engaging with us to try to solve a problem, and then use your financing as strategically as you can to get at what might solve the problem. And so, I hope they move into this, but what we know is that if we approach them and just appeal to their kindness and generosity, they may do it for a while-
Give us your money.
But they’ll get bored!
Yeah. Give us your money.
But if we engage them with seemingly intractable problems, and say, ’Do you think your technology can help us solve this problem?’ That could be much more productive.
All right. Let’s finish up talking about your wish list then. What would you like? If you had to go through these companies, what would you like from them? Google.
For any of these companies, I would like them to send people to us. I’d like for them to pay the salaries, and then send their best people just to come and sit with us, and learn about how we do things, tell us about how they do things, but then take the problems that we face ... Go with us to the poorest countries, take a look at these different problems, and what I ... When I go there I start ... My mind starts flashing, because all these problems that I deal with every day I start thinking, ’Well, could that work for that? Could that work for that?’ I went to Hangzhou to visit Alibaba, and we had like 10 ideas that came out of that one meeting.
He’s very enthusiastic.
He is. Jack is great. I mean, he’s one of the first people-
Now he has a lot more time.
And Jack’s thing is education-
Yeah. It is.
And he’s focusing on educating principals, the principals of schools in management, which is probably exactly right for many of the schools, especially in China.
But anyway, we’d love to have people here just sitting with us, and we have financing. When I walked in the door-
Take it there, they can pay for it.
When we walked in the door in April of ... I mean, July of 2012 we were at $35 billion, we just got a capital increase, nobody thought we’d get it, but we had worked so hard to reform this organization that we’re now edging toward $100 billion a year. But that’s not nearly enough. We want to use that money to have transformative impact, and we’re not used to thinking so far out of the box, the way that the Googles, and Microsofts, and Amazons are.
On things like bitcoin, for example, those are the kinds of things you have to start thinking about, right?
Well, our first reaction-
Let me say cryptocurrency-
Well, our first reaction to things is: One, can it be helpful to developing countries? And, two, are there dangers for developing countries that we need to help them deal with? And so, at first, a lot of these cryptocurrencies, at least the experts told me, not all of them, but a lot of them were more like Ponzi schemes-
And I said that, and it keeps coming back to haunt me. But what that led to was we started looking at-
Yeah. We started looking at blockchain and distributed ledger technology, and it turns out that there’s so many applications. And the first application that we put into places ... We sell bonds. In other words, we need to raise money on the capital markets, and so we did the first blockchain bond in history, and it was pretty simple. It’s just using distributed ledger technology to take care of all of the paperwork. Now, there are huge companies that do that paperwork for you, which adds to the cost of the bond, and so doing it through distributed ledger technology reduced our cost dramatically. Now, the companies that do that work are not happy about it, but what a great application. And so, we’re going to keep doing that. We’re going to keep looking at what are the specific aspects that we can put to use right now to make things work better.
But we need to be disrupted. It’s very hard for us to disrupt ourselves-
Absolutely. You’re exactly right about foreign ministers they’re just not going to disrupt themselves, or the education system-
Education it’s hard. It’s very hard-
But they won’t.
The bank, the World Bank, we now need to be disrupted as well-
And at the same time, the World Bank is sort of been known as lecturing to people across ... You know what I mean?
And so there’s not a two-way discussion going on.
Well, it’s interesting. So, my great friend and predecessor, who was one of the great World Bank presidents, Jim Wolfensohn told me that when he walked in the door in 1995, every single vice president was a white male. Now, we’re as diverse as half female, we’re from all over the world, but that’s what it was. And there was a strong sense back then that it was former colonial officers coming to lecture people. And so, I’ve really worked hard to try to change that.
I speak Spanish, so in Latin America, they’ve had an especially difficult relationship with the World Bank, but I spent 15 years working in the slums of Lima, Peru so I speak Spanish. And so, I’m now el chino que hable español. ¿Quién es el chino que hable español? Who is this crazy Chinese guy who speaks Spanish? Not what we thought a World Bank president would be, or would look like, and it’s made a huge difference in Latin America just that I took the time to learn Spanish, and work in these communities.
Well, diversity is a whole nother topic we can get into it another time.
It’s a whole other topic, but, I mean, the fact that I’m so different from what they expected.
In Africa, they certainly see me differently, because they remember me from the AIDS battles. I mean, they remember me running around Africa, trying to start AIDS treatment programs.
So, finishing up last question. If you could ask for anything right now from Silicon Valley, just whatever besides piles of their piles of money, what would it be?
It would be engage-
Bringing people here.
Engage, engage, engage. We’re sending people out there, because we don’t know how to bring people here. It’s not been easy to do, and I don’t know that they’re going to think that it’s in their interest. But we do transport, energy, IT, we do health, we do education-
We do macro economic policy, we do all kinds of infrastructure-
What about self driving experiments somewhere-
We have 189 member countries. We have 189 member countries.
Yeah. What about a self-driving experiment somewhere?
We’d be happy to do it. And so, we’ve done some small research projects, but it’s on the top of everyone’s list. But we are open for the best people to come here. I will make sure that the experience is great for them, and I know now our teams are hungry for this, ’cause disruptive technology is a big theme. And I had to bring that whole operation in to my office just to make sure that it wasn’t just sort of cast aside-
Oh, as the office of innovation ...
It makes it work harder. We have to think more. We have to think about more complex deals. It’s harder, but that’s what I would ...Because, look, I want to end with this.
I mean, President Macron and Chancellor Merkel, they are so concerned about Africa, and what they will tell you is that if you think the Syrian refugee crisis was bad, just wait until these African countries start to collapse. It’s very close to Europe. Life in Europe, as we know it, will change, because they’re going to see on their smartphones that life is better over there.
And so, for me, it’s not a matter of stopping migration. I’m a migrant. I believe in migration. Migration is a great thing. What I’m saying is that on issues like climate change, and on issues like people’s aspirations going up, if technology doesn’t engage, the world that they’re leaving to their children and grandchildren, in fact the world that they are going to live in themselves, is going to be so ugly that you’re going to have a situation where the richest will always be able to protect themselves-
But they’re going to have to-
Build higher walls, higher platforms, and it’s not a world that you want to leave to your children. And your children will ask you-
What you did.
“How could you leave that kind of world to us?” My children are already asking me. I mean, we are the largest funder of climate change activities in the world, and we became that way in the last five years-
Well, that’s a whole ‘nother layer on top of it.
That’s right. But we got that way in the last five years.
It’s going to be forced migration.
I’ve been pushing and pushing and pushing, we’re now the largest financier of climate change activities. But my kids still ask me, “Dad, why aren’t you doing more for climate change?” Good question. Everyone will ask us this, and if the tech industry thinks the questions are being asked now are tough, wait until the questions come about inequality, about you guys have stoked the aspirations of everyone in the world, and then taken all of their jobs away. We don’t want that to happen, and we know the leaders don’t want that to happen.
But, Jim, they gave you Fortnite and Amazon Echo.
Oh my goodness.
I won’t make you answer that. Anyway this has been a fantastic discussion. Thank you so much. This is Jim Yong Kim, he’s the president of the World Bank Group, and you have to help him. Thank you.
Thank you, Kara.
This article originally appeared on Recode.net.