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Muhammad Yunus on Microfinance, Grameen Bank & How 5 Men Own More Wealth Than Half the World

Web ExclusiveOctober 06, 2017
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Muhammad Yunus, founder of Grameen Bank and recipient of the 2006 Nobel Peace Prize, joins us for an extended interview on microfinance, the Grameen Bank, and how five men own more wealth than half of the world. His new book is titled “A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions.”

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: This is Democracy Now!,, The War and Peace Report. I’m Amy Goodman, with Part 2 of our conversation with Muhammad Yunus, founder of the Grameen Bank in Bangladesh, 2006 Nobel Peace Prize winner. He’s out with a new book, has just come to the United States. The book is called A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions.

Muhammad Yunus, it’s such a great privilege to have you here. We did Part 1 of our conversation on the global broadcast, Democracy Now!. Let’s go more deeply into this “world of three zeros.” Talk about what these zeros are.

MUHAMMAD YUNUS: Three zeros are zero poverty, zero unemployment and zero net carbon emission. I put this whole book together with the one central theme. The theme is the capitalist system is not working for people. It’s working for only a few people who amass all the wealth of the entire world. Today, eight people in the world has more wealth than the bottom 50 percent of the people. And tomorrow, it will be less than—

AMY GOODMAN: Eight men—

MUHAMMAD YUNUS: Only eight person.

AMY GOODMAN: —have more wealth.

MUHAMMAD YUNUS: More wealth than the entire half of the population of the entire world.

AMY GOODMAN: Three-point-six billion people.

MUHAMMAD YUNUS: Billion people, yes. And now I’m told, recently, that there are only five people now, not only eight, does the same, own more wealth than the bottom 50 percent of the people.

AMY GOODMAN: We’re down to five.

MUHAMMAD YUNUS: Down to five now. And, gradually, it’ll go down to three, down to one. And speed is so high right now, the concentration speed. Concentration was going on along with capitalism for a long time, but it was not perceptible. Today, it became so obvious that all the wealth in the hands of few people. So what happens to the economy? Do you call it an economy anymore? This is just a bundle of wealth to some people, and the rest of the people don’t have anything left for themselves.

And then you come to a question of the artificial intelligence, robotics coming in. At least people were working, getting some money, getting their livelihood. What happens after artificial intelligence take away everything that you work for? And I’m told that—in Bangladesh, we have the garment industry. More than 4 million women work in the garment industry. Soon it will disappear, in the next 10 to 12 years, because artificial intelligence will do a better job than these women do. And then you don’t have to bring it to Bangladesh, because you can do it in your backyard, wherever you are located. You don’t have to travel all the way to Bangladesh to order their goods and then transport it here or anywhere in Europe, someplace else. So, what happens to those people who have been working? And those who uphold—happens to all the ancillary businesses, developed the shipping, packaging? You know, all those things, you don’t need anymore, because everything is gone. So, what happens to the world as a whole when artificial intelligence take out half the working population and so on?

So, we have to be aware now. It’s not a question of tomorrow. So I emphasize the question of now. And I say that it can be done. It’s not just worrying about it. I said I’ll give the example in my experience, shared experience, it can be done. I said there are two central flaws in the entire capitalist system. First of all, it’s a money-centric system. It’s a greed-centric system. It’s all based on personal interest, a selfish interest. I said human beings are not simply selfish; they are selfish as well as selfless. The selflessness part was never played into economics. I said this is time to bring it in. And I gave examples of lots of companies that I have created, businesses that I have created, which are not focused on making money. They’re focused on solving problem. This is a wonderful design of business: business to solve problem, rather than make money. And if you like it, you can address all these problems by just business way, so that the money keeps rolling, instead of getting into your pocket and disappearing into wealth and so on. So, I said this is the case. Then we are seeing all the businesses that we created, and many businesses are coming and creating social business on the side. So this is one.

The second problem, I’d say that not only there are two kinds of business—business to make money, business to solve problems—it can work simultaneously. Whole world can do that. Every person can do that. Second part I’m emphasizing, the flaw in the capitalist system, that we are told to work for somebody else. And everybody’s trying to grow up and get a job. “Job” is the buzzword in the entire life. I say that’s a wrong orientation given by the present capitalist system. Human beings are not born to work for somebody else. Human beings are basically entrepreneurs. That’s what our history tells us. Our history tells us that we are go-getters, we are problem solvers. We’ve managed everybody’s job, not just my personal job. So, why don’t we go back to that? Why don’t you give the option to young people that you can be a job seeker, also you can be an entrepreneur? Then, lots of these young people will become entrepreneurs there, because, today, only thing they are told, you get a good education and get a good job, as if this job is the end of your life. Job is not the end of your life. Creativity is your basic feature. And bring creativity, challenge the world, make things happen, in a business way, and so on. So, create financial institutions to make that happen.

So these are the basic two flaws. If you can fix that, if you can introduce that as options, not because you eliminate something and put something else in place. I’m not arguing for eliminating anything. I’m saying put this as an option. Capitalist system is supposed to be a system of options. But when it comes to business, you have no option. You have only kind of business. When it comes to a job, there is no option. You have to have a job. I said give option to young people so that they can become entrepreneurs, or they can become job seekers. They should remember that we are not job seekers, we are entrepreneurs, and build themselves.

AMY GOODMAN: So, for people who aren’t familiar with the Grameen Bank, which you pioneered—it’s the reason you won the Nobel Peace Prize, and I’d like you to talk about how economics relates to peace—talk about the essential tenets of what you call microfinancing.

MUHAMMAD YUNUS: It started in Bangladesh some 42 years back. Started the basic idea that I had to stop the loan sharking in the village, because I see the terrible loan sharking going on. So idea that came that I can do that. Why don’t I lend money myself? If I start lending money, then people will come to me. They will not go to loan shark. They’ll save themselves all the trouble that they have got—have to go through with the loan sharks. So I started lending money out of my own pocket money. And it worked. And people were very responsive. They were very happy that I’m giving them the money. It became bigger and bigger.

AMY GOODMAN: And they would then pay you back.

MUHAMMAD YUNUS: And they pay back completely. We have no problem so far, any income.

AMY GOODMAN: What about interest?

MUHAMMAD YUNUS: We charge interest to cover the cost. And we have a—we created a bank called Grameen Bank, or village bank.

AMY GOODMAN: But the difference between you and the loan sharks, and the bank and the loan sharks?

MUHAMMAD YUNUS: This bank is owned by them. The whole bank is owned by—today there are 9 million borrowers in Grameen Bank in Bangladesh, 97 percent women, mostly women, to take loans and improve their life. And the bank makes profit. Profit goes back to them. Nobody takes the money away from them. So, it’s a—

AMY GOODMAN: Why women?

MUHAMMAD YUNUS: We started out as a kind of a protest against the banking system. It doesn’t lend money to poor people. Then I said it doesn’t lend money to women, as well. Women of any financial status, they just don’t lend money. Not even 1 percent of the borrowers of the banks in Bangladesh, at that time, happened to be women. So I protested that. I said, “Why you do this? This cannot be done.” So, when I began, I wanted to make sure half the borrowers in my program are women. That’s a very simple decision, so that I can justify that, yes, what I am saying is correct, it can be done. We did that.

It was a very hard task to persuade women to take money and start a business, because they never did it in their life. But we persuaded them, gave them examples and then inspired them, and finally they started doing that. When they saw some women are doing that, others got inspired. And it started snowballing and became big. And then we saw money going to the family through women brought much more benefit to the family, same amount of money going to the family through men. Women took good care of the children, which parents—the father didn’t pay much attention to, and many other things in this household. So, we changed our policy, and instead of 50/50, we said, “Let’s give priority to women.” As a result, we became 90 percent, 95 percent, 97 percent—today, 97 percent.

And when it came to United States, today we have Grameen America, same program that we do in Bangladesh at Grameen Bank. We have started in 2008. Today there are 100,000 women in 11 cities, with 20 branches—seven branches in New York and other branches in other cities—near 100 percent repayment, no guarantee, no collateral needed. It’s a trust-based banking, as we do it in Bangladesh, exactly follow the same principles. And they improve themselves. So, more than a billion dollars has been given out. We had no problem.

AMY GOODMAN: Let me ask you—there was a BBC article a few years ago that said, “The Bangladesh poor selling organs to pay debts.” Does the Grameen Bank impose a penalty for failure to repay debts? Are borrowers free to reschedule their loans? Is there a pressure asserted by other borrowers?

MUHAMMAD YUNUS: One of the basic principles we had with Grameen Bank was there will be no penalty whatsoever for anything, even if you don’t pay back the money. So there’s no question of this, this is a loan shark or something, that—mixing up everything. And this bank is owned by them. They sit on the board. They make the decisions. So it’s not secretly somebody is doing something. It’s their bank. They get the money. They get elected representatives sitting on the board making policies, and so on and so forth. So there’s a—and there’s no pressure on getting the money back. If you don’t pay back, still we will not come to you. We simply say, “You think about it. Maybe you’ll need it someday.” Two years later, three years later, same woman comes back, said, “Can I come back again?” We say, “Of course you can come back again. There’s no problem with this.” We give loans to their children, to help education—education loan. We give scholarships to the children. We give housing loan. We get pension funds for them. So, it is all built in.

To give another example regarding this, now we lend out about two-and-a-half billion dollars per year, in Grameen Bank, the loan that we give. The savings program that we just started right from the beginning, the totality of all the savings deposits right now, the balance of it within the bank, is more than two-and-a-half billion dollars. So if you have collectively two-and-a-half billion dollars in your savings account, why do you have to go to sell your organs to do that, and nobody’s forcing you to do that?

AMY GOODMAN: Where do you see this happening in the United States, microlending that you think works?

MUHAMMAD YUNUS: New York, seven branches; Omaha, Nebraska; Charlotte, North Carolina; Houston; Los Angeles, two branches.

AMY GOODMAN: This is two branches of the Grameen Bank?

MUHAMMAD YUNUS: This is Grameen America. We call them Grameen America. So, seven branches and other—in total, there are 20 branches. And for the next 10 years, we are planning to have 40 branches and with half a million borrowers within the United States. And we’ll be lending out over $10 billion in the next 10 years. And it could be bigger, too. This is the slowest expansion that we could manage, because we don’t know how—where the source of the money. I said, since we don’t have the banking license in this country, we cannot generate money inside the program. In Bangladesh, we are a bank, so we can take deposits. We have no shortage of money. We keep lending money. And then borrowers also save the money in the bank, so we have enough money to lend them money, so we have no problem. Here, we have the problem. Money has to come from outside, before we can lend the money. But if you get $250 million, in 10 years, we can give out $10 billion, with that $250 million.

AMY GOODMAN: Who is standing in your way from being certified as a bank here?

MUHAMMAD YUNUS: The rules, regulations. It’s nothing else. People are very sympathetic, but they are caught by the rules. So we need a special license, a special banking license, to do exactly what we do and plus take deposits. That’s all we need to do.

AMY GOODMAN: So, this is how you deal with zero poverty.


AMY GOODMAN: Talk about zero net carbon emissions. In the first part of this conversation, we were talking about Bangladesh. A third of it is underwater, massive flooding in Bangladesh, India, Nepal. Over 1,300 people have died, probably the number much higher. You’re coming to the United States at a time when it’s being ravaged by hurricanes. So, what is the solution?

MUHAMMAD YUNUS: This is related to bigger central issues, the global warming. We cannot handle it in Bangladesh. Only thing, we’ll survive, cope with it, make sure that we can come back to our life after the cycle of flood goes. We start planting again. Our crop was damaged. Agriculture is completely erased away. So we start all over again. So life starts all over again for us in that sense. So this is one way that we try to create awareness in the world that, look, this is not only happening in Bangladesh. Imagine all the island countries around the world. You have Puerto Rico as a good case of what is happening, and all the Caribbean islands who have been lashed with all the hurricane and the floods and so on and so forth, the waters upsurge and so on. It happens in many countries. So, tomorrow it will get worse. Some countries will permanently disappear, because they cannot survive. They have to take the people out. So this is a broader area. And then we have to work together. It’s not just one country.

Secondly, we have to redesign our lifestyle. We have to teach our children in school that our lifestyle, we live in a way so that our enjoying life will not harm the enjoyment of life of another country or another children, so that then children will learn what are the things that I do harms and affects negatively on the children of other countries and so on, so that I become aware that there’s a link between what I do, what I consume, what lifestyle I have, on the other people’s lifestyle. So this is another one that we have to—consumers have to be aware what should I consume so that it doesn’t harm the planet, and what should I avoid consuming because it is harming the planet. There should be some kind of green level and yellow level and red level on the consumer goods, so that I know if it is red level, that means it harms the planet, so I don’t want to—

AMY GOODMAN: How do you rate it?

MUHAMMAD YUNUS: Rate it, because it’s a fossil fuel-based thing, very simple thing. There are many things very simple. You know that it harms. And then you say, “Oh, somebody will do something to counter it.” Why you rely on somebody? You’re doing the harm, and somebody has to do the good thing—that’s not a good one. You do it yourself. If you must do it, then go and plant some trees, so that it counters it. It’s the net emission we are talking about, not just emission. So if you are damaging the planet, your actions, and you do the counter-action, so that my damage is balanced out. So this is one.

For example, in Bangladesh, we created a—whatever damages we do, we have the whole country, the [inaudible] villages, on kerosene lamp, because after the sun goes out, all you can do is kerosene lamp. You are using the fossil fuel and harming your health. Breathing that gas out of this kerosene, it’s harmful to the health. Then we thought, “Why don’t we bring solar energy in the villages?” Everybody said, “No, Bangladesh is not a solar energy country. This is a—you need big money.” I said, “No, I’m not talking big money. I’m talking about small money, small thing.” So I started a company called Solar Energy—Grameen Solar Energy, and started selling solar home systems. In the beginning, it was extremely difficult to sell. But then I gave them the option that whatever money you spend on kerosene, give it to us every month, and we give you solar home system right away. So we started it. Today, we have more than 2 million homes with the solar energy, solar home system. So we replaced the fossil fuel with the renewal energy, in a social business way.

AMY GOODMAN: As we’re here sitting, it is a great privilege, and people are lined up to talk to you. You have a phone interview in two minutes. I want to give you a last word. You’re in the most powerful country on Earth, the United States, the president of the United States a climate change denier, who pulled out of the Paris climate accord. Your final words to the people of the United States of America?

MUHAMMAD YUNUS: You are the most powerful country in the world. Your leadership, the whole world is waiting. And we can change this world, if you want to. It’s just a personal desire, nothing else. You don’t have to wait for the government decisions. Government decisions are important, but individual decisions are also important, too, that I want to make this planet as a safe planet, and find out how to do that. And I want to change the world, which is, instead of concentrating wealth on the top, I can put in the reverse gear, by creating business to solve problem, rather than make money. And I will encourage my children to think about it, whether they would like to be a job seeker or they would like to be an entrepreneur. Give them option and see what happens.

AMY GOODMAN: Muhammad Yunus, we want to thank you so much for being with us, founder of the Grameen Bank, recipient of the Nobel Peace Prize. He has a new book out; it’s called A World of Three Zeros: The New Economics of Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions.

If you’d like to see Part 1 of our conversation, go to I’m Amy Goodman. Thanks so much for joining us.

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