Last week, House Speaker John Boehner (R-OH), House Minority Leader Nancy Pelosi (D-CA), Senate Majority Leader Harry Reid (D-NV), and Senate Minority Leader Mitch McConnell (R-KY) presented Dr. Muhammad Yunus with a Congressional Gold Medal in recognition of his efforts to alleviate poverty. More than 100 other Congresspeople from both parties and houses attended the ceremony.
In a political climate where agreement is rare, the ceremony stands out -- especially given the ways Yunus's priorities seem to differ from Washington conventional wisdom.
Yunus, of course, is Bangladesh's famed "banker to the poor" who founded the Grameen Bank to provide people in poverty with access to credit and savings. Yunus's now-global influence only occasionally enters American headlines -- as when Oprah Winfrey named the Yunus-inspired lending platform Kiva.org one of her official "Favorite Things" in 2010 -- but Grameen's model has inspired thousands of similar institutions worldwide. In 2006, Yunus and Grameen shared the Nobel Peace Prize.
I've seen the power of responsible microfinance many times. In Rwanda, for example, I met a single mother of three whose life was radically improved after she was able to open a neighborhood sundries store with a loan from a local Yunus-inspired bank. She and her children no longer slept on a mat in an unpowered shack, but in a proper bed under a solid roof, with a steady enough income not to worry about their next meal. Her first loan was for the equivalent of less than $150, an amount no conventional bank would have considered.
In America, microloans are much larger, but the idea -- serving the underbanked -- is the same, and its benefits are clear. A recent study of clients of Accion and Opportunity Fund, two of America's largest micro- and small-business lenders, found that 97 percent of loan recipients remain in business a year later (compared to other studies' 80 percent rate, plus or minus, for small business in general); more than half of recipients employed others (roughly twice the national rate); and of that group, an average of 5.6 jobs were created or sustained by each loan.
It's easy to see why leaders of both major parties should praise Yunus. He's more than a Nobel laureate -- he's a job-creator, after all, whose enterprises have directly employed tens of thousands. Those businesses, in turn, have helped create income for millions of small entrepreneurs.
But there's much more to see here. Grameen Bank is the most visible example of what Yunus calls "social business" -- enterprises whose priority is not to maximize profit, but to function sustainably while maximizing social benefit to the largest group possible.
It's a profound shift from Wall Street capitalism: where a traditional eyewear manufacturer, for example, might pursue profit by going upscale, adorning their glasses with jewels and shiny metals at the largest possible markup, a social business might instead serve the millions in poverty who need but cannot afford eyewear, seeking to decrease costs enough to maintain a profit.
The former enriches a few, very much. The latter enriches many, even more.
It may sound idealistic, but in Bangladesh, various Grameen enterprises provide health care, education, alternative energy, and more, touching millions of lives. Over and over, Yunus and his followers have shown that empowering the poor can be a powerful stimulus for enterprise.
In recent American political and economic discussion, however, "empowering the poor" barely registers as a thing. Economic inequality has been increasing for decades (here's a good visualization), and large swaths of once-great cities are now in decay, but the only solution typically discussed on Wall Street or in the financial press is more of what got us here. In politics, meanwhile, the best that some leaders can muster is to brutally mischaracterize tens of millions of struggling Americans as mere "takers."
This can't be a failure of courage or intelligence. Few leaders emerge without at least decent-sized dollops of both. Maybe it's a failure of ideology.
If we wrongly imagine charity and profit as competing, one has to win over the other. But neither is sustainable by itself. Charity, alone, asks for endless generosity without gain; profit, alone, asks for endless resources without responsibility.
Yunus's vision is of a third, more balanced path, where businesses are created specifically to solve social problems, seeking enrichment of not just owners and shareholders, but all of society -- the poor most of all. The Grameen lending example is already helping tens of thousands of small businesses across America.
So last week -- amid a budget debate largely about the proper speed with which to fray the social safety net, with any eventual cuts most directly impacting our elderly and poor -- our leaders have saluted a pioneer of finding creative ways to help the poorest of the poor.
This week, if they return to business as usual, the irony will be as predictable as it is painful.
Now that our leaders have given Dr. Yunus a gold medal, perhaps they might more truly honor him by considering why.
Source: Huffington Post