Issue link: https://tmcpulse.uberflip.com/i/1125769
31 t m c » p u l s e | j u n e 2 0 1 9 JOHN and LAURA ARNOLD lead Arnold Ventures, a Houston-based philanthropy developing innovative solutions to some of the country's most persistent problems, from pension underfunding to the high cost of prescription drugs. John Arnold was an energy trader for Enron and then started his own hedge fund, Centaurus Advisors, before retiring at age 38. Forbes estimates his worth at $3.3 billion. Laura Arnold is an attorney and former oil executive. Q | So, you're a husband and wife who work together. Do you have separate offices at your Houston headquarters? LA | We do, but there's a door between them. Q | Arnold Ventures, No. 8 on the Chronicle of Philanthropy's list of top donors for 2018, gave away a total of $204,300,000 last year. At the moment, your philanthropy is focused on four areas—health care, educa- tion, criminal justice and public finance— though not limited by these categories. How do you decide which issues to take on? LA | We're interested in market failures across the board. The set of criteria we use to think about where we focus is: Is this an area where we believe there is a systemic failure? Do we believe philan- thropy could add value in creating alternatives and developing solutions? Is it a good fit for us— meaning, is it in our skill set? We don't invest in a lot of hospitals, for example. We're not scientists. We couldn't add value in cancer research over and above writing a check. But we believe we could add value to pharmaceutical pricing over and above writing a check, because it's more consistent with our backgrounds and expertise. Finally, we look at whether or not this is an area where we think bipartisan or nonpartisan consensus could occur from a policy perspective in the near- to medium-term future. The areas in which we're currently focusing are areas where we believe all those criteria are met and we believe we are uniquely positioned to pursue those oppor- tunities given the current political landscape. JA | Houston's been blessed with a number of very generous philanthropists who have funded the hospitals to provide the facilities we have today. But there's less focus, especially from a philanthropic perspective, on looking at things more holistically: How do we increase access to health care by bringing costs down? We viewed that as a somewhat unique perspective, because health care costs are eating the federal budget. It's the single biggest driver on the fiscal health of this country long term. It's eating employers. It's eating the individual. Compensation is income plus benefits, and the problem is most of the compensation gain has been swallowed up by the cost increase in benefits. ➟