RAGE AGAINST THE MACHINE, OR PLAY THE SLOTS? DEMOCRACY, WEALTH AND MICROFINANCE

August 2016

As we all still digest the ramifications of the ‘Leave’ vote, and the political chaos that has ensued, you’ll be hard pressed to find anyone who doesn’t agree with the assertion that the rising levels of inequality and the unequal distribution of wealth have played a significant factor in the haemorrhaging of public opinion in this country.

Many of us will have seen the recent Oxfam statistics: 62 people own as much as the poorest half of the world's population (9 are women); the richest 1% now has as much wealth as the rest of the world combined; and the average footprint of the richest 1% globally could be as much as 175 times that of the poorest 10%. For reference, it takes cash and assets worth $68,800 (£48,300) to get into the top 10%, and $760,000 (£533,000) to be in the 1% (source: Oxfam, An Economy for the top 1%, Jan 2016).

Median pay in the UK is roughly £23k. If one was to superimpose other assets on top, that figure would rise, although to what level we don’t know.

Obviously, the reference framework for someone in the UK versus, for example, someone in Kenya is different. The cost of living is considerably higher in the UK, but the provision of public services is considerably more evolved thus affording free access to healthcare and education.

Poverty knows no boundaries. It is, unfortunately, like cancer. It doesn’t discriminate and can knock on any of our doors at any time. So, how do we safeguard against it? We know unequal distribution of wealth erodes social cohesion, and divides that which should unite us: a sense of community. The late Jo Cox MP spent her life striving to tackle this.

One way we can help society prosper, equally and sustainably, is through microfinance and microcredit. By giving more of us the opportunity to establish successful enterprises that meet our lifestyle and professional aspirations according to our skills and passions, a sense of unity, commonality and community will increase. It helps knit an economic fabric in society that is lasting.

“Poverty is the absence of all human rights. The frustrations, hostility and anger generated by abject poverty cannot sustain peace in any society.”

Muhammad Yunus

In April 2016, we were incredibly privileged to have breakfast with Professor Muhammad Yunus, Nobel Laureate and the grandfather of the modern microfinance movement. Yunus introduced and explained the rationale behind the Yunus Social Business Global Initiative (YSB) and why he believes that, whilst philanthropy has a role to play, it’s investment and mission driven businesses that will drive us forward as a global and local community. Repurposing wealth to tackle the divisions that have grown will go some, if not all, the way in delivering the UN Sustainable Development Goals. Microfinance and microcredit is part of that toolkit. It is universally applicable and part of the necessary fabric in all economies.

Yunus also believes that, as humans, we are all born with limitless potential. But in order to fulfil that potential we need to shift from selfishness to selflessness. We need to understand that, fundamentally, we are all the same, we are all born equal, and it is what Warren Buffet refers to as the Ovarian Lottery that in many defines what happens next.

“There is the expression of selfishness and there is the expression of selflessness - but economists or theoreticians never touched that part. They said: 'Go and become a philanthropist.' I said, 'No, I can do that in the business world, create a different kind of business - a business based on selflessness.'

Muhammad Yunus

So, whilst many people in this country have exercised their democratic right to rage against the machine, it is the underlying message we must look at. The rage is against inequality. The rage is against a growing sense of disunity. If we are to tackle that, we must tackle the thorny issue of wealth and its unequal distribution. And as we look to that, those of us lucky enough to form part of the global 10%, must look to microfinance and investment as a means through which we can help increase the global and local sense of prosperity. On that note, I’m off to exercise my democratic right to get some change and play the microfinance slot machines……