" The world has forgotten the human tradition of self�employment," he says. " When people lived in caves they went out to help themselves. There was no state to ask for help."
His Grameen Bank, now copied by 458 programs serving nearly 15 million borrowers on all continents, is deliberately aimed at helping the very poorest climb on to the economic ladder. The thesis is microcredit: very small loans to people who have nothing to start with, but who want to help themselves.
It has proved self�sustaining. They pay back at the rate of 98 percent, which any commercial banker would envy, and go on from there. There has been little effort to adapt the idea to the very different circumstances in industrial countries, where the answer to unemployment has become benefits until jobs are created. But it is an idea well suited to changing modern economies, as well as to the fight against endemic poverty.
The notion of jobs, after all, is a direct consequence of the Industrial Revolution. People have always labored, but it was not until production began to be organized around the machine that they needed a job, someone to assign them a place in the organization and someone to pay them for it.
The new economic revolution reopens the question. Big factories and offices are laying off workers, but the possibilities for self�employment have been little explored. The assumption is that someone must hire you. Great pools of skill and knowledge are left untapped when people are told they must look for a job but cannot find one. Mr. Yunus is convinced that the magic breakthrough tool is credit¾ microcredit¾ at commercial rates, but without the commercial requirement of collateral or existing earnings.
Two more elements would be needed to bring broad�scale results in industrial countries.
It is a striking contrast with the slogan of the 1848 revolution, recalled now on the 150th anniversary of the founding of France�s short�lived Second Republic. The demand at the barricades then was "the right to work instead of to charity".
The government has promised to provide 150,000 new jobs for unemployed youth and proclaims that its legislation to impose a 35�hour workweek will lead to a large number of new hires. The response has been highly skeptical. Meanwhile, it is not doing anything to encourage self�employment.
Of course, there exists a category of self�employment on a large scale in many countries: the black market.
"It should be called the golden market, " says Mr. Yunus. Governments do not like it because it escapes taxes and regulation. He suggests that under a certain maximum, self-employed people who do not hire others should be freed from taxes. It would cost less than paying unemployment benefits and supporting make�work.
Microcredit has proved its worth among the poorest. It should be given a chance to break the unemployment impasse in countries obliged to shift to postindustrial economic structures. The capacity to do useful work is there. That is not necessarily synonymous with having a job. The alternative is self�employment. and this form of credit is needed to make that possible for a lot more people.
Extracted from the International Herald Tribune, March 6, 1998.