We don’t need to go back to a pre-corona world: Muhammad Yunus

My question is why do we want to want to go back to a pre-corona world at all? Is it worth it? The world which we have left behind during this pandemic was not a happy but a terrible world… a world which was about to end.”

With these words, Nobel Peace laureate Muhammad Yunus gripped the attention of the well-attended webinar titled No going back, organised by Rotary Club of Madras, RID 3232. He said that prior to the Covid pandemic “we were all in a fast-moving train… a high-speed bullet train, rushing to the ultimate journey to disaster with the disaster point not too far away. In my opinion this pandemic has luckily stopped this train and given us the opportunity to get off, take a look around and ask ourselves should we board that train again and finish the journey to the ultimate destination, which is disaster? Or take this opportunity created by the pandemic and go in a different direction.”

Yunus said he was forced to ask these questions because everywhere in the world, the frenzied dialogue was on how to quickly return to the pre-corona world. He was “worried” because of the “enormous eagerness of governments, policy makers and big businesses to rush back to the world we had inhabited before corona. Governments have been pouring in a huge amount of money in bail out packages, some governments in billions of dollars and some in trillions.”

The younger generation holds us responsible and accuses us of destroying the world they have to grow up in, and in which they see no future.

He spelt out three reasons for saying we were headed towards disaster; the first being global warming threatening to finish the world in just a matter of “two or three decades and not even half a century”. That there was not much time left for this disaster could be seen from “our younger generation marching on the streets and blaming the older generation… accusing their own parents and grandparents, people like us, of being irresponsible. They hold us responsible for destroying the world they have to grow up in, and in which they see no future. We have stolen their future is their accusation.”

The second reason was that “most of the wealth of the world is concentrated in very few hands, and this was reaching an explosive point… like a ticking time bomb and we don’t have much time.” Here too the pandemic had provided the opportunity for more equitable sharing of the world’s wealth.

The third reason for a world heading for disaster was the growing, massive unemployment. Raising a very crucial point, Yunus said that this time the dialogue on unemployment was different. Normally the talk is about the number of unemployed people, but during this pandemic, the discussion had changed to “the employed people losing their jobs in massive numbers.” There were even startling predictions that in the next 15 years nearly a billion people will be out of jobs. “That is the fast route we are taking to disaster and all because of artificial intelligence (AI) and machines taking over human jobs. That’s not a happy scenario.”

Taking these three major reasons into account, Yunus said, “returning to the pre-pandemic world would be committing suicide.”

Business is designed wrong; it is based on the premise that all human beings are driven by self-interest. But that is a misrepresentation of the human being, if true, Rotary would not have been born.

He maintained that there were remedies to halt, avert and even reverse this disaster “but we don’t want to do that because we are in our comfort zone.” Giving the example of an obese person, Yunus said, he/she knows how to shape up but doesn’t actually do it. “We are in the same bus. We know how to stop global warming, the concentration of wealth in a few hands and massive unemployment. But we don’t do it.”

Yunus said one of the ways we can reverse the march to disaster was “by rethinking and redesigning of business. I say business is designed in a wrong way, because it is based on the premise that all human beings are driven by a single principle — that of self-interest. So I design the business for myself and for profit maximisation. That is the essence of business today.”

This kind of business was based on the “misrepresentation of the human being; a human being is not a 100 per cent selfish being, if it was so, then Rotary would not have been born, forget it having spread all over the world! You came into being because you wanted to do something for others. We have to recognise this economic theory that we are selfish and not walk away from it. We may be selfish and self-interested people; at the same time we are also interested in common interest and that’s where Rotary comes in.”

Once this was accepted then we’ll have to bring in two kinds of businesses; one that we already have, business for profit and the other which economists never recognised, but its time has come. This was social business or business to solve other people’s problems “rather than make money for ourselves. In one business there is maximisation of profit or profit for myself; the other is just the reverse, and more efficient than charity, as charity money goes out to do good, but doesn’t come back.”

Hence he has advocated the idea of social business, where the money comes back through some profit and can be recycled again and again to do tremendous good. Referring to RIPE Shekhar Mehta’s opening remarks on the money Rotarians in India had spent on water and sanitation and other community projects, he said “all this money you spend on your programmes, can be recycled, if the model is tweaked.” Giving an example, he said, “when you reach clean water to people, they can pay tiny money for it which can be recycled and you can use that money again instead of raising money every year, and you can enlarge social business in a massive way.”

Human beings are born entrepreneurs, but our education system never opened that door of opportunity for them. It shut it down making everybody a job seeker and taking away young people’s creative power.

Coming to the colossal problem of unemployment the world will face as the pandemic will take away jobs from the already employed, Yunus said: “In education, we say get a good education so that you can get a good job; we say this as though a job is the destiny of every human being. But I say human beings are not born to do jobs, they are born entrepreneurs, but our education system never opened that door of opportunity for them. It shut it down making everybody a job seeker and taking away the creative power of young individuals.”

But once the education system was tweaked to make entrepreneurs of the young, next the financial system will have to be made suitable to help them. While in the entire Indian subcontinent “we are proud of our entrepreneurs,” the very definition of the word “entrepreneur” would have to be changed and made more inclusive.

Giving the example of migrant workers, he said millions of them “leave their homes to sell their skills, either selling their wares on the roads, or bringing in different and special skills required for different jobs, but suddenly you get the corona pain and we found millions of them walking back home. So I say what kind of an economy is this which treats its migrants thus?”

Yunus suggested that “the entire economy of the informal sector should be recognised as a micro entrepreneurial sector. If you do that, you will need a whole lot of rules, policies and actions, because as long as you call it the informal sector, you have no responsibility towards it, and those belonging to it are on their own. But why should they be on their own? They are the base of the entire pyramid of entrepreneurship in our countries. So we have to introduce the idea of the micro entrepreneur and support that system.”

Leaning heavily on Rotarians for their help and partnership, the Nobel laureate said, “I want Rotary to be a joint partner in such ventures, support and finance them.”

Asked a question on the future of microfinance and whether it would be able to “survive this huge crisis,” Yunus smiled and said, “I think about 65–70 per cent of the population of India falls into the informal sector, they take care of themselves, survive on their own and for their financial needs depend on the loan sharks, of one kind or another; the tiny one, the large one, the neighbourhood one.”

There are startling predictions that in the next 15 years nearly a billion people will be out of jobs. That is the fast route we are taking to disaster.

And a major portion of whatever they get from the immense hard work they do is taken away by the loan shark. “So why don’t we create a financial system for them? Earlier it used to be said that we can’t have banking for poor people. We have proved it that it can be done, both in Bangladesh, India and elsewhere. And yet it is not within the reach of millions. So why don’t we build a financial sector in such a way that nobody is left out. If we do that, the loan shark as a concept will simply disappear. We can do it.”

Microcredit had been established as “absolutely legitimate banking. We started it in a small way in Bangladesh and then it spread to India in a big way and then became a global phenomenon. And yet, comparatively speaking, it is small and just a footnote in the financial sector because there is no government policy on it. I have been pleading why not the government create a ministry of micro entrepreneurs (ME). If you have ministry of labour, then why not for ME; they are larger in number and potentially more powerful. Once you have a ministry of ME, then you have the responsibility of building this sector and creating ME banks, which don’t make money. Grameen bank was never invented to make money but to serve people.”

Coming to the question on whether microfinance would survive this pandemic, Yunus gave the example of Bangladesh which had displayed the successful model of microfinance. “This country is known for natural disasters, and we’ve had one disaster after another. Even during Covid time we had a very big flood. But nobody writes about it.”

He said in Bangladesh, when during a flood, water enters your home, that is regarded a “normal flood”, but then there are “abnormal floods when water goes over your rooftop and you lose everything… your home, your animals, your savings, everything. This is almost routine, but during such times, microcredit goes on, it doesn’t disappear.”

He said the microcredit programme was designed in such a way that it works for the people and “stands by those in trouble and helps them get back on their feet. That is the essence of social business; it is designed to keep you on your feet. In Covid-19, you have not lost your homes, animals, etc. Compared to some of the floods we get, this is a tiny and temporary thing, you will suffer but you still have your family.”

Asked by RIPE Mehta on what Rotary should do and how it could help, Yunus said: “Many things, we have annual gatherings, which you can attend; we have some big companies on board such as France’s Danone, McCain Foods, the Canadian company, and some Japanese companies. We have a lecture series, which you can attend and get ideas. Rotary clubs can create a social business fund, which is a two-way fund and money will come back, so that you can do more projects.”

These businesses ask the unemployed who are keen to become entrepreneurs to come forward with business ideas and help them with both professional advice and finance. “You give the money the first time, it will come back and then if he wants a second round, you can have a phase two in that business. In the first phase, a social business can be a tiny little thing. You can help so many. Getting five people out of unemployment is not rocket science, but all we think of doing is call somebody and recommend a person for a job when an unemployed comes to you. But that is not the solution. The solution is how this guy can create employment for others. That is transformational. In Bangladesh we say we are not job seekers, but job creators. Many successful people started small, luck favoured them, but it doesn’t favour millions.”

Earlier, addressing the meet, Mehta shared with the Nobel laureate some of the community development projects that Rotarians have been doing in India on water and sanitation, health, literacy and education, livelihood enhancement, etc. “This is Rotary’s 100^th year in India and we thought that as we have some 150,000 Rotarians, it is time that Rotary plays a role in nation-building. Doing small projects here and there doesn’t suit a 100-year-old organisation, so for the last 5–6 years we have been working on various issues, literacy being in the forefront.”

Making India fully literate was a passion that Rotarians shared and towards that goal they had taken several initiatives, the latest being augmenting the e-learning programme in government schools. “By 2025, we want to go to each and every government school in India and change the medium of learning to audio visual. You and I have learnt about solar eclipse from black and white text books, but imagine now we can visually show the children the movement of the earth, moon, etc so that the child can grasp these lessons much better.”

He explained how during the pandemic Rotary has struck a partnership with the Indian government whereby the e-learning content it has given will be beamed across every nook and corner of India through 12 TV channels the government has created for education. Mehta said now Rotarians from Nepal and Bangladesh were also being involved in this project so that they can replicate the e-learning models in their country.

Welcoming the participants, RC Madras president Kapil Chitale said Yunus was the “father of economic revolution in the world of microcredit and microfinance. With one per cent of the world’s population holding 99 per cent of its wealth, such path-breaking initiatives alone can hope to bridge this economic divide.”