Non-Coercive or Voluntary Societies

I had the privilege of attending two talks today by Nobel laureate Prof. Muhammad Yunus and health activist Prof. Paul Farmer.

The first talk was organized by the ASSU Speakers Bureau in Cubberley Auditorium. I landed there with my wife twenty minutes ahead of time, and already there was a queue going out of the auditorium. I remember noting that no one had told us to form an orderly queue - we just did. We got good seats in the middle of the hall. At sharp 12 noon, Dr. Yunus walked in. Upto that point, I was not thinking about anything - and so I was amazed by the emotions I felt on seeing him walk in. It seemed as though he had a presence that was magnified by the mostly permanent smile he had on his face, of a person who was enjoying himself at every moment. Indeed, I must admit that Dr. Yunus is my hero, my role model. If one professes libertarian ideals, one couldn't find a better vindication than the founder of Grameen Bank.

As soon as he was called onto the stage, I just found myself spontaneously rising with the rest of the audience to give him a standing ovation. And as I stood there clapping, something was happening in my heart - I felt connected to humanity, indeed I felt human. We sat down, and Dr. Yunus gave a talk, without any notes or powerpoint slides. He was logical, coherent, funny and deeply inspiring. He first pointed out that human beings have two sides - the selfish and the selfless. Almost all the economic theory around us has been developed around the selfish side, and almost none on the selfless side. He asked us to consider the door that led to the selfless side.

One poignant remark he made was about the creditworthy and how for years, conventional banking had not considered the poorest to be creditworthy. Today, with the financial crisis, it turns out that Grameen's borrowers are far more creditworthy than those whom traditional finance deals with. Dr. Yunus appealed for a redesign of the banking system that helps people at all levels. He appealed to the youth to consider becoming social entrepreneurs, to develop their selfless side, and put on selfless "glasses" - and then see how the world would change for us.

He told us about the success of Grameen Dannon and how they add micronutrients to tackle malnutrition in children. Grameen's latest credit adventure is to become a banker for beggars. The program has been so successful that beggars number over 100,000 of Grameen's clients, and are turning into salesmen. Some have stopped begging while others are part-time beggars, part-time salesmen. And they are paying back their zero-interest loans.

It is sad that in India, the government tried to get into microfinance and messed it up. Thereafter, we've had small pockets of success, but not much in the scale of Grameen. I want to go at some point to Bangladesh to visit the Grameen Bank and see what we can learn.

Moving to Paul Farmer, like the previous talk, there was a standing ovation in Kresge Auditorium. Organized by FaceAids and PIH, most of the audience seemed to know about Dr. Farmer. He is an inspiring doctor who turned conventional thinking upside down and showed how anti-retroviral drugs could be administered in a cost-effective manner in Haiti and Rwanda bringing much needed relief to HIV patients. Conventional thinkers thought that the poor in these countries would not use the medication properly, hence, the virus would develop resistance and render the medication ineffective. This was used as an argument to sidestep relief strategies. Farmer started a movement to remedy this, and showed that with the help of community health workers, great relief could be brought to HIV patients, who have now survived for several years and are themselves becoming caregivers to others. An interesting point he made was that the greatest need was to pay the community health workers, but somehow other experts didn't think the workers should be paid - they should all be volunteers!

Surprisingly, Dr. Farmer thought it was a good idea for the US to raise money to give to Haiti and Rwanda. He had a good argument - there was much the US had done wrong in Haiti, and it was time for restitution. However, he did not quite address the question of sustainability. So, I asked him after the talk if he had considered working with microfinance institutions to help provide an integrated economic and health offering. Strangely, he felt that microfinance institutions had not been successful as people didn't like the 11% interest rate. He preferred taxes to be used to support healthcare and education. When I mentioned Yunus and the Grameen's success, he did say he'd like to talk to Dr. Yunus. And when I mentioned Aravind Eye Hospitals' model of using the money from one paying patient to cover two who couldn't pay, he pointed out that while he had great respect for Aravind, there were many in India who can't get general healthcare, which is probably true.

I thought Dr. Farmer's work was very inspiring. However, I see taxes for universal healthcare and education as a dead-end. China and Russia have both been down that road and have scars to show for it. On the other hand, if his model of community-based health workers can be combined with Grameen's unique economic package, we wouldn't need taxes to improve the situation. People will learn to stand on their own feet, with a little bit of support in terms of credit from the rest of society. This requires investment - not charity or coercive taxation. As Dr. Yunus said today, we can make money and do good - why should we separate the two? Money is just the tool - if the goal is truly to do good, amazing things are possible with money. Dr. Yunus pointed out that charity is one-time money. However, a social venture is a better way to invest the money, because it keeps recirculating, growing and empowering the community.

I hope that these two great souls meet over a cup of tea and pick the best of each other's ideas.