(HOST) The name of the latest winner of the Nobel Peace prize rang a bell with commentator Madeleine Kunin – and reminded her of an inspiring dinner conversation.
(KUNIN) The Nobel Peace prize this year was given to Bangladeshi economist, named Muhamad Yunos, who started a program to give small bank loans to the poorest of the poor, most of them women.
Considered hopeless credit risks by the banks, these borrowers surprised everyone. Ninety-eight percent paid back every cent.
The loans were given to groups of five, creating an incentive for each one to pay back her share, in tiny amounts each week.
The pioneering system he established through the Grameen bank is called micro credit.
The first loan he made in 1976 for a sum of twenty-seven dollars came out of his own pocket.
Today, it’s estimated that more than one hundred million people receive small loans from three thousand, one hundred institutions.
I had an opportunity to chat with Mr. Yunos, in 1995, when I was a delegate at the Fourth World Conference on Women in Beijing, and I sat to him at a dinner. He was a modest man, but impassioned, and his goal is nothing less than to eliminate poverty.
The loans he said may buy a cow, or some wool for weaving, or incense to sell in the stalls – all small items that can create a profit for a poor family.
Today, one of the chief items are cell phones to lend to other people in the villages to make calls. Yes, there’s some problems with the program. Yunus told me that they were developing further training programs so that borrowers could learn business skills to enable their small enterprises to grow. He also acknowledged that in traditional Muslim societies, they sometimes have to counsel husbands who have difficulty in accepting a wife’s new financial independence.
We know that there is no single panacea for eliminating poverty.
Yet what Muhammad Yunus has demonstrated is that there are small ways to alleviate poverty, person-by-person, family-by-family. This is a model that works and has been successfully replicated in one hundred and thirty countries.
It is significant that for his life’s work, this economist, who thought outside of the box, was given the Nobel Peace Prize. The prize did not go to an international mediator, or a statesman who brokered a peace treaty.
It went to a man whose goal is to eliminate poverty, to enable the poor to rise up. The committee had the wisdom to see that the best prevention strategy to avoid future conflicts is to lift people out of poverty.
Poverty fuels conflict.
Reduce poverty, and the fuel pile is reduced.
That is why it is fitting for the Nobel committee to give its peace prize to a man who is helping to create a more equitable and thereby, a more stable world.
Madeleine May Kunin is a former governor of Vermont.