How should we rebuild in the wake of the coronavirus pandemic? Bangladeshi social entrepreneur Muhammad Yunus, winner of the 2006 Nobel Peace Prize, said in a contribution to the Mainichi Shimbun that the world will benefit tremendously from “a clear instruction that we don’t want to go back to where we came from.” He points out that there is now an opportunity to rebuild from a clean slate, and with social and environmental concerns firmly in mind. Questions and answers follow. The interview has been edited for length and clarity.
What will the novel coronavirus pandemic bring about for humankind?
The extent of damage that the corona pandemic is causing the world is just mind-boggling. However, despite this massive damage, it offers us an unparalleled opportunity.
Right now, the whole world has to address a big question. It is not about how to get the economy running again. Luckily, we know the answer to that. We have gathered good experiences of managing recovery processes. The big question that we have to answer is: Do we take the world back to where it was before coronavirus came? Or, do we redesign the world? The decision is entirely ours.
Needless to say, the pre-corona world was not going well for us. Until coronavirus became the news, the whole world was screaming about all the terrible things which are about to happen to the world. We were literally counting the days until the whole planet would be unfit for human existence because of the climate catastrophe; how we are under serious threat of massive unemployment created by artificial intelligence; how wealth concentration was reaching an explosive level. We were reminding each other that the current decade is the last chance decade. After this decade, all our efforts will bring only marginal results, inadequate to save our planet.
Coronavirus suddenly changed the context and calculus of the world. It has opened up audacious possibilities which never existed before. Suddenly we are at the tabula rasa. We can go any direction we want. What an unbelievable freedom of choice!
Should we go back to that world before the pandemic? The choice is ours.
Before we restart the economy, we must agree on what kind of economy we want. First and foremost, we have to agree that the economy is a means, not an end. It facilitates us to reach the goals we set. It should not behave like a death trap designed by some divine power to punish us. We should not forget for a moment that it is a tool made by us. We must keep on designing and redesigning it until we arrive at the highest collective happiness.
If at any point we feel that it (the economy) is not taking us where we want to go, we immediately know that there is something wrong with its current hardware or software. All we have to do is to fix it. We cannot excuse ourselves by saying, “Sorry we cannot achieve our goals because our software or hardware will not let us do that.” That would be an unacceptably lame excuse. If we want to create a world of zero net carbon emissions, we build the right hardware and software for it. If we want a world of zero unemployment, we do the same. If we want a world where there will be no concentration of wealth, we do the same. It is all about building the right hardware, and the right software. Power is in us. When human beings set their mind to get something done, they just do it. Nothing is impossible for human beings.
The most exciting news is that the corona crisis offers us almost limitless opportunities to make a fresh start. We can start designing our hardware and software on an almost clean slate.
What kind of world should we create?
The point of departure for a post-corona rebuilding program must be to put social and environmental consciousness firmly at the center of all decision-making. Governments must guarantee that not a single dollar will be offered to anyone unless the government is sure that it will bring the maximum social and environmental benefit to society, compared to all other options.
One simple unanimous global decision will help us tremendously: a clear instruction that we don’t want to go back to where we came from. We don’t want to jump into the same frying pan in the name of recovery. We should not even call it a “recovery” program. To make our purpose clear, we may call it a ‘rebuilding’ program.
We start with ‘rebuilding’ packages for social consciousness driven plans and actions. We must design our plans right now, when we are in the thick of the crisis. When the crisis is over, there will be a stampede of old ideas and old kinds of bailout to rush the process in a certain way. Strong cases will be made to derail the new initiatives by saying these are untested policies. We’ll have to get ready before the stampede begins. The time is NOW.
What should an economic recovery plan look like?
In this comprehensive rebuilding plan, I propose to give the central role to a new form of business called a social business. It is a business created solely for solving people’s problems, without taking any personal profit for the investors except to recoup the original investment. After the original investment is paid back, all subsequent profits are ploughed back into the business.
Governments will have many opportunities to encourage, prioritize, and open up space for social businesses to undertake major rebuilding responsibilities. At the same time, governments should not expect social businesses to show up everywhere at the time and scale they are needed. Governments must launch their own programs, such as taking care of the destitute and the unemployed through traditional welfare programs, offering healthcare, reviving all essential services, and supporting all types of businesses where social business options are slow to come forward.
Governments can create “social business venture capital funds,” centrally and locally. They can also encourage the private sector, foundations, financial institutions, and investment funds, to create social business venture capital funds, encourage traditional companies to become social businesses themselves or take in social business partners. Corporations and all businesses may be encouraged to have their own social businesses or create joint venture social businesses with social business partners.
Under the rebuilding program, governments can finance social businesses to buy up companies, and tie-up with needy companies to transform them into social businesses. Central banks can allow social businesses, like other businesses, to receive financing from financial institutions to invest in the stock market.
There will be so many opportunities arising during the rebuilding process; governments should involve as many social business actors as possible.
Since government is the institution responsible for solving all social and environmental problems, it constantly needs money. As problems become bigger, it needs bigger and bigger budgets to do the job.
Social business brings citizens into the picture for solving social problems. It reduces the burden on the government.
Citizens can take away some of the government’s responsibilities, which reduces the pressure on the state budget.
Isn’t it difficult to find social investors?
Who are the social business investors? Where do we find them? They are everywhere. We don’t see them because our existing economic textbooks don’t recognize their existence. As a result, our eyes are not to trained to see them. Only recently have economics courses included some discussions on topics like social businesses, social entrepreneurship, impact investment, non-profit organizations etc. as side issues inspired by the global admiration for Grameen Bank and microcredit.
As long as economics remains a science for profit maximization, we cannot rely entirely on it for the rebuilding program, which is based on social and environmental consciousness. The whole strategy would be to enlarge the proportion of social businesses in the total economy as the economy grows. The success of social business will be visible not only when it grows into a larger percentage of the economy; there will also be rapid growth in the number of entrepreneurs doing both types of business. This will signal the beginning of a social and environmental consciousness-driven economy.
As soon as government policy starts recognizing social business entrepreneurs and investors, such entrepreneurs and investors will come forward enthusiastically to play the important social role demanded by this historic opportunity. Social business entrepreneurs are not members of a small do-gooder community. This is a significant global eco-system which includes giant multinational companies, big social business funds, many talented CEOs, corporate bodies, foundations, trusts, with many years of experiences in financing and running global and local social businesses.
When the concept and the experiences of social businesses start receiving government attention, many hardcore personal profit-makers will be happy to tap the unexplored parts of their talent to become successful social business entrepreneurs and play very valuable social roles at times of social and economic crisis, like the climate crisis, unemployment crisis, wealth concentration crisis, etc.
here does the key for the social business concept lie?
The social business concept emerges from the thought that each human being has the capacity to change the world. This faith in one’s ability to bringing changes to society is the key to taking interest in social business and making it a success. This faith has to be cultivated in each person through his or her upbringing in the family, and the education he or she has.
Today, we do the reverse in families and in schools. We encourage children to get ready to find the best job in the best company. A job is taken as the destiny of human beings. All accumulated social problems are left on the shoulders of the government. Government is the only institution responsible for addressing all social problems. The citizens’ role is to obey the law and pay taxes. Citizens are never told that each one of them has power to solve the problems they see around them. That awareness leads to social business, which is a tool with which to solve problems.
The post-pandemic rebuilding program must break the traditional division of tasks between citizens and the government. It is taken for granted that the citizens’ role is to take care of their families and pay taxes; it is the responsibility of the government (and to a limited extent of the non-profit sector) to take care of all collective problems, like climate, jobs, healthcare, education, water, and so on. The rebuilding program should break down this dividing wall and encourage all citizens to come forward and show their talent as problem-solvers by creating social businesses. Their strength is not in the size of their initiatives, but in their number. Each small initiative multiplied by a big number will turn out to be a significant national action.
Out of the desperation and urgency of the post-corona situation, the right call from a government can create a surge of activities we’ve never seen before. This will be the test of leadership, to show how a world can be inspired to be reborn in completely unknown ways, coming from the youth, middle-aged people, and the old, men and women both.
After the world recovered from the global economic crisis following the collapse of U.S. financial services firm Lehman Brothers in 2008, disparity quickly emerged in U.S. society. Is desire for wealth a part of human nature? How can we control the deep, limitless desire people have?
It is human nature to seek self-protection. Greed is a distorted and blown-up form of self-preservation. Greed is not natural to human beings. It is promoted by external factors, like the economic theory which dominates the world today. This theory is based on an Economic Man who is driven by self-interest. He doesn’t have any sense of collective interest, which a real human being has.
A real, caring human being is distorted by theory into a selfish human being. Then theory sets the goal of profit maximization as the objective of all businesses. It sets accumulation of wealth as the measure of success. Real Man has no option but to turn into a greedy man under the pressure of the theory. Should we blame people for turning into greedy people, or blame the theory?
If we want to contain the greedy people, we have to go to the root of the problem. Our whole system is based on the theory which promotes greed. Our education system drills these concepts into the minds of our youth. They come out of the education system accepting the theory as the ultimate truth. They get no chance to see themselves as socially conscious human beings. The education system turns them into money-making robots. The human part of them is destroyed by design, not by accident.
In Cuba and other places, socialism has not functioned well, leading to the introduction of market principles. There are people who say they won’t work without monetary rewards.
Why are people stimulated by monetary rewards? Because that’s the only thing we learn from our homes, schools, and workplaces. There is no room for any other experiences. There are plenty of examples around the world of people making amazing sacrifices to make the world a better place. We watch them as if we are watching movies. It moves us for a while, then we get back to the real world that we live in.
Economic theory has to be redesigned to be based on Real Man, not the artificial Economic Man. Then the whole world will change. Now, instead of us making the theory, we find ourselves in the strange situation where the theory has made us. We have to reclaim our role as makers of theory, instead of remaining its product.
What about the idea of a universal basic income, in which the government provides the minimum needed to live one’s life, for all citizens? Spain has moved in this direction in the wake of the coronavirus pandemic.
I do not agree with this proposal. I think it is counterproductive. It can be justified in special circumstances, like disasters, etc., or for people with special needs, like old age, physical or mental handicaps, etc. It should not be considered as an entitlement of every citizen for all time to come. It will encourage dependence, rather than self-reliance. To me a good society is one which inspires citizens to discover their own potential. I see human life as a journey of self-discovery, self-fulfillment. Basic income does not help us undertake that journey. It does the reverse. It pulls people back from taking that journey. It encourages people to remain unknown to themselves.
This issue of basic income comes from a faulty conclusion of capitalist economics. It concludes that all human beings, except for a few entrepreneurs, must earn their living by finding a job. The economy has to be built to create employment. If one doesn’t have a job, he needs to be taken care of by the state with a subsidy.
I argue that economic theory came to a wrong conclusion, as a result of which we have created a wrong world. If we can forget the theory for a moment and look at how normal people lived throughout history, we see them as problem solvers, struggling with nature to survive, through innovation and creativity. The essence of human beings is creativity. Human beings are born as entrepreneurs, not as job-seekers. A job is the end of creativity. It is a life defined by instructions, and submission.
Instead of giving a basic income, the state should create a new environment through repurposing the education system, which is now designed to produce job-ready young people. Instead, it should be producing young people ready to unleash their entrepreneurial creativity. Every child should be told that he/she is an entrepreneur. An exciting life of creativity is waiting for him/her out there. The financial system has to be redesigned to make sure every young person has access to financing to become the entrepreneur he/she wants to be.
If we fail to fundamentally rebuild the world, what will happen?
If we fail to undertake a social and environmental consciousness-driven post-corona rebuilding program, we’ll be heading for a catastrophe many times worse than what corona has brought. We can hide in our homes from the coronavirus, but if we fail to address deteriorating global issues, we’ll have no place to hide from angry Mother Nature and the angry masses all around the world.
(Interview edited by Sumire Kunieda, Integrated Digital News Center)