From Poverty To Peace: Creating What We Want

Gem Fire Air
From Poverty To Peace: Creating What We Want
marty kleva
January 6, 2007


Peace should be understood in a human way - in a broad social, political and economic way. Peace is threatened by unjust economic, social and political order, absence of democracy, environmental degradation and absence of human rights.

— Muhammad Yunus- 2006 Nobel Peace Prize Recipient


From Poverty To Peace: Creating What We Want

Within the last week, my Explorations For Peace have turned up surprising results; some from GFA readers who have shared their daily practice to invoke Peace. One friend and reader sent me a lovely gift that I share with you all and which will have a permanent place on our front page. “May You Be Blessed”, a short film created and produced by Kate Nowak, is an uplifting expression of Peace and delivers an inspiring message for all people. (it may take a few days to get the link onsite—you will find it right below the link to Flickr)

As part of my exploration, I went looking to see what the rest of the world is doing in the name of Peace and found the 2006 Top Story that is truly astounding in regard not only to the implications it provokes, but also in its repercussions throughout the world. In October ’06, the Nobel Peace Prize was awarded to a Bangladeshi economist, 66-year-old Muhammad Yunus and the GAMEEN BANK he founded, which uses micro-finance to support income-generating businesses.

Since its start 30 years ago GAMEEN BANK has loaned out $5.72 Billion, has 6.61 million borrowers, 2,226 branches, and reports a 99% repayment rate!

What is more significant and even astounding is to find out that the loans have mainly gone to impoverished women in over 100 countries including Bangladesh, Uganda, Malaysia and the U.S. Muhammad Yunus found that women were more careful in the way they spent their money, and that they paid back the loans in higher percentages than did the men.

Further astonishing is the fact that these are collateral-free loans.

In 1974, coming from the United States, Yunus took a teaching job in the economics department at the Chittagong University in Bangladesh and found he could not ignore the poverty all around him as he taught “elegant theories of economics” in the classroom amidst the backdrop of famine.

In his acceptance address to the Nobel Committee in Oslo, December 10, 2006, Yunus tells how he became involved with the issue of poverty:

I was shocked to discover a woman in the village, borrowing less than a dollar from the money-lender, on the condition that he would have the exclusive right to buy all she produces at the price he decides. This, to me, was a way of recruiting slave labor.

I decided to make a list of the victims of this money-lending "business" in the village next door to our campus.

When my list was done, it had the names of 42 victims who borrowed a total amount of US $27. I offered US $27 from my own pocket to get these victims out of the clutches of those money-lenders. The excitement that was created among the people by this small action got me further involved in it. If I could make so many people so happy with such a tiny amount of money, why not do more of it?

That is what I have been trying to do ever since. The first thing I did was to try to persuade the bank located in the campus to lend money to the poor. But that did not work. The bank said that the poor were not creditworthy. After all my efforts, over several months, failed I offered to become a guarantor for the loans to the poor. I was stunned by the result. The poor paid back their loans, on time, every time! But still I kept confronting difficulties in expanding the program through the existing banks. That was when I decided to create a separate bank for the poor, and in 1983, I finally succeeded in doing that. I named it Grameen Bank or Village bank.

Today, Grameen Bank gives loans to nearly 7.0 million poor people, 97 per cent of whom are women, in 73,000 villages in Bangladesh. Grameen Bank gives collateral-free income generating, housing, student and micro-enterprise loans to the poor families and offers a host of attractive savings, pension funds and insurance products for its members. Since it introduced them in 1984, housing loans have been used to construct 640,000 houses. The legal ownership of these houses belongs to the women themselves. We focused on women because we found giving loans to women always brought more benefits to the family.

In a cumulative way the bank has given out loans totaling about US $6.0 billion. The repayment rate is 99%. Grameen Bank routinely makes profit. Financially, it is self-reliant and has not taken donor money since 1995. Deposits and own resources of Grameen Bank today amount to 143 per cent of all outstanding loans. According to Grameen Bank's internal survey, 58 per cent of our borrowers have crossed the poverty line.

So how is this connected to Peace and the Nobel Prize for Peace?

Yunus begins his address with this statement:

By giving us this prize, the Norwegian Nobel Committee has given important support to the proposition that peace is inextricably linked to poverty. Poverty is a threat to peace.

World's income distribution gives a very telling story. Ninety four percent of the world income goes to 40 percent of the population while sixty percent of people live on only 6 per cent of world income. Half of the world population lives on two dollars a day. Over one billion people live on less than a dollar a day. This is no formula for peace.

And he states his findings and beliefs about terrorism:

We must address the root causes of terrorism to end it for all time to come. I believe that putting resources into improving the lives of the poor people is a better strategy than spending it on guns.

Yunus takes the abstract idea of Peace that many people only talk about, and puts it into an action that involves millions of people, who then within the midst of a region-wide famine, can afford to feed and clothe their children rather than have nothing to nurture them with, can send their children to school rather than have them go out and beg, and know that they are a contributor to their community as a leader and entrepreneur rather than being a drain on community resources.

Unus continues to bring his message to the heart of the matter and says:

Poverty Is The Denial Of All Human Rights

Peace should be understood in a human way - in a broad social, political and economic way. Peace is threatened by unjust economic, social and political order, absence of democracy, environmental degradation and absence of human rights.

Poverty is the absence of all human rights. The frustrations, hostility and anger generated by abject poverty cannot sustain peace in any society. For building stable peace we must find ways to provide opportunities for people to live decent lives.

The creation of opportunities for the majority of people - the poor - is at the heart of the work that we have dedicated ourselves to during the past 30 years.

So many times I have heard how lazy poor people are. They get put down and criticized for being in the position they are in. Sometimes I think, "Well there is always someone who has to be at the bottom of the ladder."— and go on to think it will not be me left there.

This is the type of thinking we use in a design system of competition, where the desire and goal is always to move toward the top, like the old game of King On The Mountain.

What if there is also another game to be played, where we are not limited to create success by the very system that is a game inherently designed with restraints? What if we decide to create a game to live by that says there are no restrictions?

Looking to the universe and cosmos as a model, and referring back to the post on subtle energy, if all dark matter is actually the origin and resource for all physical matter, we have a hugely untapped resource available to us to create a world where there is always enough for everybody.

This seems to be the premise that Muhammad Yunus comes from when he uses micro-economics as the base for GAMEEN BANK. When he started with $27 to pluck 42 impoverished people from the bottom of the ladder, he created a new game in finance using fractal concepts.

It reads much like the Bible story told of when Jesus divided the loaves and the fishes among too many people to feed, and no one went hungry. That model is available to us; Yunus tapped into that paradigm of thinking and applied it to his life.

Yunus and GRAMEEN BANK has not stopped there.

The women who are our borrowers always gave topmost priority to the children. One of the Sixteen Decisions developed and followed by them was to send children to school. Grameen Bank encouraged them, and before long all the children were going to school. Many of these children made it to the top of their class. We wanted to celebrate that, so so we introduced scholarships for talented students. Grameen Bank now gives 30,000 scholarships every year.

Many of the children went on to higher education to become doctors, engineers, college teachers and other professionals. We introduced student loans to make it easy for Grameen students to complete higher education. Now some of them have PhD's. There are 13,000 students on student loans. Over 7,000 students are now added to this number annually.

Three years ago we started an exclusive programme focusing on the beggars. None of Grameen Bank's rules apply to them. Loans are interest-free; they can pay whatever amount they wish, whenever they wish. We gave them the idea to carry small merchandise such as snacks, toys or household items, when they went from house to house for begging. The idea worked. There are now 85,000 beggars in the program. About 5,000 of them have already stopped begging completely. Typical loan to a beggar is $12.

As a first step to bring Information and communication technology (ICT) to the poor we created a mobile phone company, Grameen Phone. We gave loans from Grameen Bank to the poor women to buy mobile phones to sell phone services in the villages. We saw the synergy between microcredit and ICT.

The phone business was a success and became a coveted enterprise for Grameen borrowers. Telephone-ladies quickly learned and innovated the ropes of the telephone business, and it has become the quickest way to get out of poverty and to earn social respectability. Today there are nearly 300,000 telephone ladies providing telephone service in all the villages of Bangladesh. Grameen Phone has more than 10 million subscribers, and is the largest mobile phone company in the country.

According to Yunus, “In Bangladesh 80 percent of the poor families have already been reached with microcredit. We are hoping that by 2010, 100 per cent of the poor families will be reached.”

Imagine that! Giving beggars a loan without the usual rules, a loan that is interest free, that can, but need not be repaid! Yunus sees many perspectives involved in using micro-credit to uplift impoverished people in a free market economy and speaks not only of the restrictions involved, but also of the way that the for-maximum-profit-only business model excludes the multi-dimensional aspects of human beings.

I am in favor of strengthening the freedom of the market. At the same time, I am very unhappy about the conceptual restrictions imposed on the players in the market. This originates from the assumption that entrepreneurs are one-dimensional human beings, who are dedicated to one mission in their business lives - to maximize profit. This interpretation of capitalism insulates the entrepreneurs from all political, emotional, social, spiritual, environmental dimensions of their lives. This was done perhaps as a reasonable simplification, but it stripped away the very essentials of human life.

Human beings are a wonderful creation embodied with limitless human qualities and capabilities. Our theoretical constructs should make room for the blossoming of those qualities, not assume them away.

Many of the world's problems exist because of this restriction on the players of free-market. The world has not resolved the problem of crushing poverty that half of its population suffers. Healthcare remains out of the reach of the majority of the world population. The country with the richest and freest market fails to provide healthcare for one-fifth of its population.

We have remained so impressed by the success of the free-market that we never dared to express any doubt about our basic assumption. To make it worse, we worked extra hard to transform ourselves, as closely as possible, into the one-dimensional human beings as conceptualized in the theory, to allow smooth functioning of free market mechanism.

By defining "entrepreneur" in a broader way we can change the character of capitalism radically, and solve many of the unresolved social and economic problems within the scope of the free market. Let us suppose an entrepreneur, instead of having a single source of motivation (such as, maximizing profit), now has two sources of motivation, which are mutually exclusive, but equally compelling - a) maximization of profit and b) doing good to people and the world.

Grameen has created two social businesses of the first type. One is a yogurt factory, to produce fortified yogurt to bring nutrition to malnourished children, in a joint venture with Danone. It will continue to expand until all malnourished children of Bangladesh are reached with this yogurt. Another is a chain of eye-care hospitals. Each hospital will undertake 10,000 cataract surgeries per year at differentiated prices to the rich and the poor.

He speaks of creating a Social Stock Market that will connect investors with social businesses whose main purpose is to either bring ownership to the poor people, or keep the profit within the poor countries, rather than to take dividends. This concept will also insure protecting their national interest from plundering companies.

As he continues, Yunus brings forth the message of changing our mindset of what we accept to be the only way things are done, the way things are. He does not point the finger in any one direction, but rather he includes all of us in the reality of why we have such poverty in this world. And hereby, he issues the challenge to everyone.

We Create What We Want

We get what we want, or what we don't refuse. We accept the fact that we will always have poor people around us, and that poverty is part of human destiny. This is precisely why we continue to have poor people around us. If we firmly believe that poverty is unacceptable to us, and that it should not belong to a civilized society, we would have built appropriate institutions and policies to create a poverty-free world.

We wanted to go to the moon, so we went there. We achieve what we want to achieve. If we are not achieving something, it is because we have not put our minds to it. We create what we want.

What we want and how we get to it depends on our mindsets. It is extremely difficult to change mindsets once they are formed. We create the world in accordance with our mindset. We need to invent ways to change our perspective continually and reconfigure our mindset quickly as new knowledge emerges. We can reconfigure our world if we can reconfigure our mindset.

We Can Put Poverty in the Museums\

I believe that we can create a poverty-free world because poverty is not created by poor people. It has been created and sustained by the economic and social system that we have designed for ourselves; the institutions and concepts that make up that system; the policies that we pursue.

Poverty is created because we built our theoretical framework on assumptions which under-estimates human capacity, by designing concepts, which are too narrow (such as concept of business, credit- worthiness, entrepreneurship, employment) or developing institutions, which remain half-done (such as financial institutions, where poor are left out). Poverty is caused by the failure at the conceptual level, rather than any lack of capability on the part of people.

I firmly believe that we can create a poverty-free world if we collectively believe in it. In a poverty-free world, the only place you would be able to see poverty is in the poverty museums. When school children take a tour of the poverty museums, they would be horrified to see the misery and indignity that some human beings had to go through. They would blame their forefathers for tolerating this inhuman condition, which existed for so long, for so many people.

A human being is born into this world fully equipped not only to take care of him or herself, but also to contribute to enlarging the well being of the world as a whole. Some get the chance to explore their potential to some degree, but many others never get any opportunity, during their lifetime, to unwrap the wonderful gift they were born with. They die unexplored and the world remains deprived of their creativity, and their contribution.

Grameen has given me an unshakeable faith in the creativity of human beings. This has led me to believe that human beings are not born to suffer the misery of hunger and poverty.

To me poor people are like bonsai trees. When you plant the best seed of the tallest tree in a flower-pot, you get a replica of the tallest tree, only inches tall. There is nothing wrong with the seed you planted, only the soil-base that is too inadequate. Poor people are bonsai people. There is nothing wrong in their seeds. Simply, society never gave them the base to grow on. All it needs to get the poor people out of poverty for us to create an enabling environment for them. Once the poor can unleash their energy and creativity, poverty will disappear very quickly.

Let us join hands to give every human being a fair chance to unleash their energy and creativity.

Muhammad Yunus and his vision of Peace may not be what I originally had in mind, but it has opened up my concept of Peace and it has enriched my life beyond bounds.

May we all receive the inspiration to produce such results in our lives.

Wishing you Peace and Creative Riches,

Con Amore,

~ mek


Link: Muhammad Yunus' acceptance address to the Nobel Committee in Oslo, December 10, 2006
http://nobelprize.org/nobel_prizes/peace/laureates/2006/yunus-lecture-en.html



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