Today I stumbled upon a topic when reading “Banker to the Poor” by Muhammad Yunus, about which I have been thinking a lot during these recent years: the importance of self-reliance and the counter-productive effects help can have. There were numereous encounters with that topic in my life. Be it a friend in a life-crisis, which made me learn to draw the lines and retreat at times. Or relationships, in which I ended up in the helping role and came to realize that I myself giving the hand was part of the problem.
The mom and her child
We all know those pictures of happy mothers helping their toddlers to take the first steps. It is what comes up to my mind whenever I am confronted with topics such as self-reliance and support. Naturally, children learn to walk by themselves. It is in their nature.
Though, there are different types of mothers, and I am now mostly interested in the following two: the relaxed mom and the overprotective mom. They both have in common that they certainly love their child. But whereas the relaxed mom knows that it’s completely normal for a child to stumble and fall, as this is part of the learning process, the overprotective mom will not let her child go freely and do everything she can to keep it from falling. This results in the relaxed mom’s child likely to walk freely in a much shorter time and making the experience that falling is not bad at all and just part of the game. But the overprotective mom’s child will most likely take longer until it walks without any help and will possibly experience situations where it has to act independantly as a huge threat.
There are two underlying attitudes to how the moms treat their child. The relaxed mom firmly believes her child has the ability to master the situation alone, that it is a person who has the skill to learn through try and error. The overprotective mom doesn’t think her child can master the situation alone. She firmly believes she has to teach it how to walk and which dangers it faces by doing so in order to keep any harm far away.
That was me!
I myself was that overprotective mom in many situations in my life. I thought I know best what other people could do to improve their life situations, listened to their complaints and depressions hours on end and followed the urge to actively give advice – and I ended up completly frustrated once I noticed something crucial: they didn’t do anything at all to change their situation. In fact, they did not even want to. And I came to realize that it was my attention they wanted – not a life change. Everyone wants love. And attention is unconsciously considered as a form of love. By giving this attention, I had unwillingly become part of a viscous cycle. Because when you’re getting attention for feeling bad, the incentive to get better is rather small.
This experience came to my mind when I first read about the difference of how the Grameen Bank works as compared to the traditional development aid.
Traditional development aid vs. microlending
It is still a common misconception that poor people simply are poor because they don’t do things right. “Traditional” development agencies therefore often used to employ expensive specialists to build infrastructure or conduct studies as to whether a country could be helped or was merely a desperate case. Others brought donations, food, machinery or other goods for free. But unfortunately, none of this efforts had a lasting effect. On the contrary: while some of the help clearly didn’t address any of the needs the poors of the region had, the rest led to a dependence on help from outside.
Many people who travelled poverty-stricken regions of this world will tell you that while the villages receiving development aid have grown dependent on help from outside, people from remote villages without access to that aid are really creative in finding ways to cope. The only thing they really lack are the resources to enhance their business, namely credit. They are even proud of their creativity and strength, and they usually wouldn’t ask for a donation but for a credit.
The Grameen Bank – in Bangladesh…and Europe
Muhammad Yunus, a professor of economics from Chittagong, Bangladesh, started addressing that problem in 1976. During the height of a famine, he started to spend time in nearby Jobra Village and to learn how the villagers lived and how he could possibly help them improve their lives. This resulted in a first micro-credit program for the poorest of the poor, which was highly successful. It enabled poor people to work their way out of poverty by enhancing their businesses and thus was a very sustainable way to address the issue of poverty.
This program was also introduced to the USA and finally to Europe. Though…here it didn’t prove very successful. You’d ask yourself why?
The answer lies in our welfare system. Before contemplating to really establish their own business, people used to calculate how much welfare money and insurance coverage they would have to give up on in order to be an entrepreneur. Also, building up one’s own enterprise means having to go through a vast amount of bureaucracy. Making money from one’s own business even means to get less welfare money. And it is so uncommon to be an entrepreneur, that aid agencies even stepped in to buy in the small business of their welfare recepients in order to have them employed in their former business.
That’s leading me to the following conclusions: the state actually makes us dependent through welfare money. It even punishes us if we dare to try out independence. For many people, it thus extinguishes any try to be an entrepreneur in the very beginning. But in the same time, any Western state is in huge troubles due to high debt. Seriously – isn’t that a true paradox?
I even started to think about why I am actually not an entrepreneur myself. The answer is simple: being employed is the only thing I know. And most of the people in my environment are employees themselves. I can count the entrepreneurs I personally know on one hand.
But we are living in times where most of the companies are seemingly restructuring and laying off people on a daily basis. There will be huge problems with the unemployed youths if noone addresses that issue. I’d call them the lost generation. Yes, we are dealing with a whole generation of young people who have no chance of ever getting a job. Simply because it is cheaper to hire someone experienced and there is a lack of jobs.
Is welfare counter-productive?
Couldn’t entrepreneurship be the answer to this problem? Shouldn’t the state foster any effort of citizens to stay independent from its welfare system? And…is welfare itself counter-productive? Would it maybe even be best to reduce welfare and instead support entrepreneurship? Shouldn’t the state rather follow the relaxed mom’s approach and help it’s citizens to be self-reliant instead of deciding about their every step? What do you think?