In the background, a Clinton staff member named Doug Band had an idea that would change the ex-president’s life.
“Only Bill Clinton could bring a group like this together,” Band thought.
Bill Clinton didn’t need Davos. He could do this himself.
Today, the Clinton Foundation is unlike anything else in the history of the nation and, perhaps, the world: It is a global philanthropic empire run by a former U.S. president and closely affiliated with a potential future president, with the audacious goal of solving some of the world’s most vexing problems by bringing together the wealthiest, glitziest and most powerful people from every part of the planet.
The evolution of the foundation, which began as a modest nonprofit focused largely on the ex-president’s library in Arkansas, is a nearly perfect reflection of the Clintons themselves. It was not designed as a master plan but rather has grown, one brainstorm at a time, in accordance with the ambitious, loyal, restless and, often, scattered nature of its primary namesake. Many programs were sparked by chance encounters in Bill Clinton’s life. A meeting with a Harlem shopkeeper. A friend’s plan to fight AIDS. The flight to Davos. Emergency heart surgery.
The foundation now includes 11 major initiatives, focused on issues as divergent as crop yields in Africa, earthquake relief in Haiti and the cost of AIDS drugs worldwide. In all, the Clintons’ constellation of related charities has raised $2 billion, employs more than 2,000 people and has a combined annual budget of more than $223 million.
In the middle of it all is Bill Clinton, a new kind of post-presidential celebrity: a convener who wrangles rich people’s money for poor people’s problems. In the process, the foundation elevates the wealthy by giving them entree to one of the nation’s most prominent political families.
This account of the foundation’s history is drawn from interviews with key players — including some foundation insiders who spoke on the condition of anonymity because they were not authorized by the charity to comment publicly — and a review of organization records. Through the foundation, Bill Clinton declined a request for an interview but provided a written statement to The Washington Post.
At its heart, the Clinton Foundation is an ingenious machine, which can turn something intangible — the Clintons’ global goodwill — into something tangible: money.
For the Clintons’ charitable causes. For their aides and allies. And, indirectly, for the Clintons themselves.
But today, the very things that made the foundation work for Bill Clinton’s purposes — its mega-dollar donations and its courting of the richest and most powerful interests in the world — have proved troublesome for Hillary Clinton’s presidential campaign.
As donations have surged, particularly as her bid for the Democratic nomination grew closer, she has been forced to answer for whether those supporters have been not merely giving to a charity but also paying to curry favor with a former secretary of state and a would-be president.
In the months after he left the White House in 2001, he was living at his family’s new home in Chappaqua, N.Y. His wife was in the Senate. His daughter was away, first at Stanford, then at Oxford. The former president stewed about leftover legal bills and bad press over last-minute pardons.
To pass the time, he turned to TiVo.
Director Steven Spielberg had given Clinton an early version of the digital TV recorder. He holed up for hours watching movies and the TV shows he had missed while he was president, several friends recalled.
“You go from running the country,” one foundation insider said, “to doing nothing.”
It wasn’t quite nothing. There was a Clinton Foundation back then, started in 1997. There were vague plans for future international charity work. But the nonprofit focused mainly on Little Rock, where Clinton was planning a library and a graduate school of public service, and envisioning an urban renaissance for the city that nurtured his political career. So the famously obsessive Clinton obsessed some more about buildings in Little Rock.
“I carried Montana,” Clinton said in one tour, pointing out an error without breaking stride, recalled Skip Rutherford, a former president of the foundation.
Clinton took note of the lights in the replica Oval Office. And the ceiling.
“Ceiling is too low,” he said, according to Rutherford. Somebody measured. Sure enough: several inches lower than the real thing. Down it came.
Clinton’s ambitions began to expand after he — and the fledgling foundation — moved into offices in Harlem, in the state where Hillary Clinton had just been elected senator. There, Bill Clinton was met by adoring crowds. And he began to believe that the Clinton Foundation was ready to do more.
As he had hoped at the outset, the foundation could aim higher than building a museum to the past. It could provide staff and money to address new ideas in the present.
Once again, as the Harlem offices buzzed with activity, Clinton had people who could follow up on his brainstorms.
“Dee Solomon, she owned a card shop on Lenox Avenue,” said Clyde Williams, the foundation’s domestic policy adviser at the time, recounting the meeting that began one such brainstorm. “She said: ‘Mr. President, I need your help. I’m a small-business owner in this community.’ She’s like, ‘I don’t know what I need you to do, but I need your help.’ ”
The president agreed to help. But how?
“We’ll figure this out,” Williams told him.
They did. By 2002, Williams had recruited Booz Allen Hamilton, a management consulting firm, and New York University business school students to mentor Solomon and other small-business owners in Harlem.
Evetta Petty, who owns the Harlem’s Heaven hat boutique, said: “It actually saved me. I think I’d be out of business by now” without that help. Her new mentors told her how to track inventory, build a customer database and offer coupons to bring in buyers. “I mean, I make fabulous hats. But I didn’t really understand how to sell them the best way I could. Now I do.”
The brainstorms continued. Clinton met high-schoolers who didn’t feel prepared for the SATs. “He was like, ‘We’ll do something about it,’ ” Williams recalled. Foundation staff members partnered with the Princeton Review for a national program. He met poor people who didn’t know about the earned-income tax credit. Soon, there was a program for that, too.
Was there ever a time when foundation officials told Clinton that one of his ideas wouldn’t work?
“Not when I was there,” Williams said. He left the foundation in 2006.
At the same time, Clinton did more formal planning with aides. He was just 56. He would be an ex-president for a long time. He wanted to do something big. And something international. He wanted to stay out of domestic policy, so it didn’t look like he was meddling in the domain of the president who had succeeded him. Or the senator he was married to.
Ira Magaziner, a longtime aide, had an idea that fit both criteria.
New drugs were available to fight the progress of HIV and AIDS, but in Africa the drugs were too expensive for many people. Magaziner wanted to lower the cost. He knew Clinton didn’t have the money to help, because he was still fundraising for the library and his own legal bills.
But, Magaziner told Clinton, he had a name brand with limitless value.
“We should use that reputation and your contacts for something big. If we succeed at this, we can help save millions of lives,” Magaziner wrote in a memo he handed to Clinton at an AIDS conference in 2002. “If we are not so successful, we still might help save tens of thousands of lives which would not be so bad.”
Mandela told Clinton: Do it.
“That means you do it,” Magaziner told Clinton.
But the truly big brainstorm of the Clinton Foundation’s early years came on that plane to Davos in 2004. Friends saw Clinton — the lost, lonely, TiVo-bingeing ex-president — transformed into a champion of Harlem and an international philanthropist. A celebrity, even among celebrities.
That night in Switzerland, Band began to work on a memo proposing a new kind of conference.
It was September 2005. A year and a half after Band’s brainstorm, the first meeting of the Clinton Global Initiative was a smashing success. Some Clinton aides had been skeptical that it would work, but Clinton had shrewdly timed it to coincide with a meeting of the U.N. General Assembly — when New York was already chockablock with world leaders looking for something more interesting than a meeting of the U.N. General Assembly.
So there were dozens of heads of state in attendance. Bono was there. Mick Jagger was there. Brad Pitt and Angelina Jolie. So was Slim, a Mexican billionaire who is one of the world’s richest men.
To get in, their companies had all been required to pledge a “commitment to action” — a specific promise to do good in the world. Starbucks pledged to help poor coffee farmers. Goldman Sachs pledged to preserve forests in Tierra del Fuego. The crown prince of Bahrain pledged to “educate select Bahraini students for leadership roles.”
For hours, they came to announce their pledges in front of Clinton — revivalists, suddenly seized by the spirit of charity. Clinton nodded approvingly from center stage as companies and individuals promised to spend their money and resources on projects the foundation would monitor. Their pledges added up to $2.5 billion.
He was doing good. But the foundation was also doing well: Every ticket to the event cost $15,000, in addition to the do-gooder pledge. (Full-time do-gooders, such as activists and nonprofits, were admitted for free.) Many corporations were also encouraged to make separate donations to the foundation. Corporate sponsors who generally paid at least $250,000 were showcased in the conference’s official literature, and they received invitations to exclusive receptions.
From 2004 to 2006 — the years before and after Clinton’s new conclave began — his foundation’s revenue more than doubled, from $58 million to $134 million.
“This was the fundraiser of fundraisers for the foundation,” one foundation insider said. The success of this idea — a Clinton-centered “Davos with a soul” — had tapped a vast new reservoir of money. “It’s so much better than going to a rubber-chicken dinner.”
The model that would guide the Clinton Foundation — and in many ways later come to vex Hillary Clinton’s campaign — was now in place: Woo the world’s most powerful interests to help the powerless.
Bill Clinton, in a statement to The Post, said the foundation has found that “partnership and cooperation” work best.
“We’ve worked with both center-right and center-left governments, large and small businesses and NGOs, and Republicans, Democrats, and independents — all of whom we have publicly disclosed,” he said.
The 2005 meeting began a golden age for the Clinton Foundation; now energized and well funded, it started to expand in all directions.
The old ideas kept growing. The business mentoring program that started in Harlem spread to nine cities. The AIDS program that started with Mandela spread until it was reducing the cost of drugs to fight a number of deadly diseases in 70 countries.
In that program, the Clinton Foundation persuaded drug companies to lower their prices. Then it sent volunteers and staffers to help governments use them, distributing HIV tests, getting those with positive tests to hospitals, setting up pharmacies to handle the drugs.
Clinton did little of the detailed work in the AIDS initiative. But he did enough. Aides said he presided at key moments and lent the program his massive goodwill.
“Particularly for the governments in Africa,” the Clinton name opened crucial doors, said Magaziner, who ran the program. “If we had showed up as a bunch of us and they didn’t know who we were, they wouldn’t necessarily have trusted that we could do what we said.”
In all, the foundation says, this work has provided cheaper drugs to 9.9 million people. Has it saved millions of lives, as Magaziner promised Clinton in the beginning? A spokeswoman wouldn’t say. She said estimating that number would violate the initiative’s principle of “operating with humility.”
At the same time, Clinton was approving new programs, in widely divergent fields.
After the former president had quadruple-bypass surgery, the foundation partnered with the American Heart Association to fight childhood obesity. After Clinton borrowed a plane from Canadian mining magnate Frank Giustra, the foundation began a new development effort — funded in part by $100 million from Giustra — that included anti-poverty programs in a number of countries where Giustra has had business interests.
And in one case, a Clinton Foundation program began with a dinner party in London.
“I knew very little about Africa, so he said, ‘If you are genuinely interested in Africa, come travel with me,’ ” Hunter once told the Christian Science Monitor. He did. After visiting the continent with Clinton, Hunter announced a $100 million gift over 10 years, to fund the new “Clinton-Hunter Development Initiative,” to help farmers and alleviate poverty in Malawi and Rwanda.
By 2009, the foundation had grown to a $242-million-a-year organization. It had nine branches, plus independent fundraising arms in Canada and Britain.
At the center of it all was Clinton, inhabiting a role he had created for himself: a “convener.” He wasn’t a philanthropist, at least in the classic sense. He was more like the world’s middleman.
In many cases, Clinton persuaded the rich and powerful to give, and he lent their gifts a tint of global prestige as they passed through. As Clinton blessed their money, their money blessed him, too. When he traveled to Africa, aides said, massive crowds strained to get a look at him.
There was other obvious proof of his exalted new status. The world’s most powerful men went out of their way to see him.
Slim, the Mexican billionaire, began traveling to hear Clinton give talks. “He’d sit there and take notes during Clinton’s speeches,” recalled Amed Khan, a longtime Clinton aide. “He’d make a list of the 10 greatest leaders on Earth, the 10 greatest orators on Earth.” Clinton was at the top, Khan said.
In 2007, Slim made an even bigger pledge: $100 million, to support Clinton Foundation projects in Latin America, where Slim’s telecom business is active.
For Clinton, the foundation had re-created many of the things he loved about the presidency — cheering crowds, an army of aides and a resonant sense that he was doing good on a global scale.
Even better, in this job, there were no foreign crises to derail his plans. And no meddling Republicans. In fact, the foundation drew contributions from some who were once Clinton’s most bitter GOP enemies, including Newsmax chief executive Christopher Ruddy and conservative mega-donor Richard Mellon Scaife.
There was also no date when the ride had to end.
The foundation came to mirror Clinton’s White House in another way, too. It employed many of the same people, including Band and Magaziner, and saw some of the same interoffice infighting for Clinton’s favor.
But the former White House employee who made the most in the foundation’s heyday was probably Clinton himself. The ex-president didn’t take an official salary from the foundation. But he has received at least $26 million in speaking fees from companies and organizations that were major donors to his foundation. And in many cases, what Clinton got paid to speak about was, in part, the foundation.
By the Clinton Foundation’s accounting, it has done something good for at least 430 million people in more than 180 countries. (There are about 195 countries in the world, depending on how you count.) When foundation officials last looked back at 2,872 different “commitments” made at the Clinton-convened conferences, they found that only 4.8 percent had not met basic goals and were therefore “unsuccessful” by foundation standards.
Overall, the foundation spends about 89 percent of its money on its charitable mission, according to the independent American Institute of Philanthropy. Based on that analysis, the watchdog group gave the foundation an “A” rating for 2013, on a scale that goes to A-plus. Charity Navigator, the other leading group that rates charities, recently put the foundation on a “watch list” because of the negative press that has surrounded it. (That group has not issued a rating for the Clinton Foundation, saying the foundation’s structure is too complex to grade.)
But, for Clinton, the work of a convener has brought unexpected complications.
For one thing, the work relies on other people’s money. And sometimes, they run short.
By 2009, Hunter, the Scottish mogul who had pledged the $100 million for development in Africa, had lost big in the financial crisis. He told the foundation he couldn’t give at the pace he had promised — he needed to retain cash for his for-profit businesses. “He said he would try to continue to support what we were doing in Rwanda” but could no longer fund the work in Malawi, said Bruce Lindsey, the longtime chairman of the foundation’s board of directors.
In response, the foundation found another donor for Malawi.Hunter has given $20 million to $25 million so far — at most a quarter of what he pledged. Hunter’s spokesman said he still plans to honor the full pledge to the Clinton-Hunter Development Initiative, although over a longer period of time.
The foundation’s broader Africa initiative continued, but under a new name.
It was called the “Clinton Development Initiative.” Named after the convener alone.
But then, in 2007, Hillary Clinton began running for president.
Since then, the foundation has been reshaped — awkwardly, at times — to accommodate her roles as candidate, secretary of state and, now, candidate again.
Hillary Clinton’s rise has more closely aligned the foundation with the Clintons’ political network. It brought new attention, which at times boosted fundraising.
But it also brought a totally new level of scrutiny — and transparency — to the sprawling operation her husband built.
Some headaches began with her first presidential campaign. For instance, donors to the successful AIDS program began to worry.
“Secretary Clinton was running for president and they thought this should be separate,” Magaziner said. They wanted to be certain that their money would go only to fight disease.
The concerns sparked a conversation within the foundation about whether to split off the health program, which by that point had grown larger than the rest of the organization.
The AIDS program, now called the Clinton Health Access Initiative, became an independent legal entity in 2010. Today, based in Boston, it employs 1,500 of the more than 2,000 people who work for Clinton-related charities. Bill Clinton and his daughter, Chelsea Clinton, still sit on its board.
“We operate on the ground and we make things happen. [The Clinton Global Initiative] is more a convening conference, using Clinton’s convening power to bring groups together,” Magaziner said, explaining the split. “They’re both legitimate things for a foundation to do. But they’re different.”
The spinoff added one more level of complexity to an already difficult-to-track organization. A number of record-keeping slip-ups that have earned the foundation recent scrutiny originated with the Boston-based health group.
Hillary Clinton’s tenure at the State Department brought other big changes.
For one thing, the Obama administration required the foundation to split itself again. The Clinton Global Initiative became its own entity. The idea was to draw a distinction — at least in theory — between the secretary’s official interactions with world leaders and her husband’s global schmooze-fests with the same people (which Hillary Clinton also attended).
Also, for the first time, the Clinton Foundation had to say who had given it money.
The list stretched to 200,000 names.
It included foreign governments, such as Saudi Arabia and Qatar, which could ask the State Department to take their side in international arguments. And it included a variety of other figures who might benefit from a relationship — or the appearance of a relationship — with the secretary. A businessman close to the ruler of Nigeria. Blackwater Training Center, a controversial military contractor. And dozens of powerful American business leaders, including some prominent conservatives, such as Rupert Murdoch.
In a brief news conference on the campaign trail last month, Hillary Clinton was asked whether she regretted the way the foundation had handled foreign donations.
“I am so proud of the foundation,” she said in Cedar Falls, Iowa. “It attracted donations from people, organizations from around the world, and I think that just goes to show that people are very supportive of the lifesaving and life-changing work it’s done here at home and elsewhere.”
The unveiling of the foundation’s donor list also showed another side of Bill Clinton’s “convening.” It appeared that some wealthy donors — who traveled with Clinton or attended his events — also had made valuable business connections at the same time.
Giustra, the Canadian mining magnate, attended Clinton-related events and met the leaders of Kazakhstan and Colombia, countries where he would later make significant business deals.
And in Haiti, the Clinton Foundation’s point man was Denis O’Brien, an Irish billionaire, who led a network of businesses and charities in donating to the earthquake-ravaged nation. After Clinton introduced O’Brien to Marriott, another foundation donor, the company joined O’Brien to build a hotel near the headquarters of O’Brien’s company in Port-au-Prince.
O’Brien and Giustra have said that Clinton inspired them to give back and that they did not seek to benefit financially from their relationship with him.
Today, the Clintons defend their foundation’s work by saying that its focus always has been on charity.
“We and our supporters care only about impact, not ideology,” Bill Clinton said in his written statement to The Post. “We are an entirely nonpolitical foundation.”
He said he started the foundation as a private citizen to pursue causes he cared about in public life. “We’ve never been afraid to take on big challenges when we believe we have the chance to make progress and improve lives,” he said in the statement.
At times, the Clinton Foundation has employed several key members of Hillary Clinton’s political team.
The Clinton Foundation also hired as a consultant Sidney Blumenthal, a longtime adviser to both Clintons from their White House days, paying him $10,000 a month starting in 2009 to advise a project to promote Bill Clinton’s presidential legacy, several people familiar with the arrangement said. (Blumenthal’s salary was first reported by Politico; foundation officials would not confirm it.)
Recently released e-mails have shown that while on the foundation payroll, Blumenthal fed back-channel — and often unreliable — intelligence reports on Libya to Clinton during her time as secretary.
After Hillary Clinton left the State Department, she became a member of the foundation’s board of directors. Like her husband, she has never drawn a salary from the foundation.
Hillary Clinton’s presidential ambitions coincided with a boom in the foundation’s fundraising. Between her departure from the State Department and the formal beginning of her campaign this spring, the Clinton Foundation announced a plan to build a $250 million endowment.
The money was raised ahead of schedule.
The foundation also became the new vehicle for her policy ideas.
There was “Too Small to Fail,” a program to encourage early childhood education. And “No Ceilings,” a joint effort with the Bill and Melinda Gates Foundation. Its aim is to improve women’s lives around the world, including by boosting literacy, fighting for equal pay and improving health.
Starting in 2011, Chelsea Clinton began work at the foundation, often supporting these and other domestic initiatives. More important, some insiders say, she brought her experience working as a management consultant for several years with McKinsey & Co. She helped lead management changes. Band was ousted.
Lindsey was replaced as chief executive in 2013 by Eric Braverman, a former colleague of Chelsea Clinton’s at McKinsey who also had worked with Bill Clinton and others on Haitian relief efforts. Braverman left the organization in January. His position is being permanently filled this week by Donna Shalala, who was secretary of health and human services under Bill Clinton.
And what if she doesn’t win?
Could the foundation still raise money if the Clinton family’s political ambitions are dead and buried?
Trying to head off criticism, Hillary Clinton formally stepped down from the organization’s board when she began her campaign.
The foundation also has been churning out fact sheets that highlight its charitable work. On Friday, Bill Clinton penned a letter to donors, dismissing criticisms as political attacks and promising that he is “more committed than ever” to the foundation’s work.
The Clinton Foundation remains a foundation about everything, sprawling into disjointed fields whose only common bond is that they once caught a Clinton’s eye — a recent example is a project to fight elephant poaching in Africa, a passion of Chelsea and Hillary Clinton’s.
In all this time, the foundation has killed off only one major initiative. It was the one that started back in Harlem, when that small-time card-shop owner asked Clinton’s small-time foundation for help.
By 2012, that mentoring program — renamed the Clinton Economic Opportunity Initiative — had recruited hundreds of volunteers over its life.
Then, it was gone.
“The initiative was too labor-intensive to be successful at scale,” Lindsey, the chairman of the foundation board, said in an e-mailed statement. He added, “The success or failure of individual businesses was too dependent on factors beyond the foundation’s control.” The NYU business students began working on Clinton projects in Haiti.
In essence, the work of mentoring small businesses was not easily expanded to a global scale. For the Clintons’ mega-charity, the project that had launched its ambitions was no longer ambitious enough.