Monday, January 26, 2009

A poverty-free world

Nobel Peace Prizer winner Muhammad Yunus, the founder of the world's largest micro credit lending network in the world, the Grameen Bank, understands that poverty is not the fault of the poor.

People are poor largely thanks to forces at work outside of their control.

The vast majority of the world's poor work incredibly hard and want to do better.

The lack of credit, education, proper nutrition, access to transportation and the unrelenting struggle to simply survive keep the poor trapped in poverty.

Yunus' vision is of a "poverty-free world." One of his trademark statements is that "the word human and poverty should never be used in relation to one another."

People were not meant to be poor.

Listen to his wisdom here.

Tell me what you think.

America's economy and markets are quite different from those of the developing world. How do we apply Yunus' values and vision here?



dmowen said...

We need local community credit unions with loan officers that understand their community. If we could re-cultivate the skill of assessing credit risk on a personal level as oppossed to credit score algorithms that work on a national level, we might be able to extend credit selectively at lower interest rates and provide an alternative to payday lenders.

Chris said...

Then the government would come in and say something like "It's not fair to loan to this person and not that person." Just like they made lending institutions loan to people not qualified and agreed to stand behind the loans. How did that work out?

Larry James said...

Chris, what you say here is not the explanation behind the failure of the current financial markets. I am told and have read recently that many major American banks had debt out at a ratio of $20 of debt for every $1 of deposits. Come to Dallas and show me the impact this practice has had on the low-income communities. You can continue to believe this lie if you want, but lending to the poor as "forced" by the government is not at all why we have the problem. You'll have to move up the monetary food chain a lot further to get to the real answer. Your tired, but typical, blame the poor and some misguided government attempt at "social engineering" is just not what is up here. It is much worse than that, much broader and much more oreinted toward greed and a lack of oversight.

Chris said...

Banking Queen Barney Frank, one of the people who caused the mess said this:

"The root of the current crisis was a trend of pushing people towards home ownership who couldn't afford it. A number of people saw the subprime mortgage problem. What very few people saw was the extent to which modern, very powerful, very sophisticated financial techniques allowed those bad loans to be so widely spread throughout the globe that they brought down the whole financial system temporarily."

In December, Fed Chairman Ben Bernanke said:

"I and others were mistaken early on in saying that the subprime crisis would be contained. The casual relationship between the housing problem and the broad financial system was very complex and difficult to predict."

The scary part is that the same people who caused this problem have no trouble in asking us, the taxpayers, for TRILLIONS in cash to rectify their blunder.

According to Bianco research, the amount we've already spent bailing out private companies now exceeds the Marshall Plan, the Louisiana Purchase, the entire historical budget of NASA, the S&L crisis bailout, the Korean War, the New Deal, Iraq and Vietnam COMBINED. Even WWII, adjusted for inflation, is about a trillion dollars less than the bailout price tag.

Now Obama wants to go down the same route as FDR. Roosevelt prolonged the depression with his New Deal projects. What ended the depression was World War II. Make work projects didn't work then, nor will they work now.

Anonymous said...

Your sources betray your conclusions, Chris. You don't present the full story. Read the new biography of Warren Buffet, Snowball. You'll see the complications of derivitives and Wall Street greed. While subprime loands played a part, though not forced by the gov't, but pursued by the banking industry, they don't explain the entire problem. The current crisis was created by people who, like you, have no use for FDR. It was on your watch that this happened friend. If anyone is to blame, it is the leaders you love. It seems strange to me that you can be critical of President Obama when it was the last 8 years that are laregely to blame, though no one involved in completely innocent. BTW--what did you think of your partiot boy Rush Limbaugh declaring that he hoped Obama failed? Great heart, great vision for America that Rush Limbaugh!

Chris said...

It was either make the risky loans or face severe government penalities.

If Obama does not fail, we will be a complete socialist country. Is that what you want?

Anonymous said...

Chris, you bring us lies about the present financial crisis, really bad history about the Great Depression, and anti-poor polemics.

And now you open posts with insults against homosexuals.

Go away, Chris.

Jeff W

Larry James said...

Chris, as many have said here, your facts are incomplete at best, wrong as a minimum and flat ridiculous when you think about it.

Chris said...

I'm open for someone to tell me where my facts are wrong.

Anonymous said...


A quick bit of internet research - from sources written for information only, and not with an agenda - indicates the approximate cost of the following wars was as follows:

WWII - $3.3 Trillion
Korea - $400 Billion (including occupation)
Vietnam - $600 Billion
Iraq - $600 Billion

So far, Congress has authorized $700B and will probably authorize another $800B soon for the "bailout."

That's $100B less than Korea, Vietnam and Iraq, even without adding all the domestic programs you mention. It's less than half the cost of WWII.

Is it a lot? Oh, yea. But it does not help the discussion to exagerate and engage in hyperbole.

(BTW - the sources for the above are Wikipedia, WikiAnswers and

Anonymous said...

Equally important to the figures themselves is the context - the US GDP when those events took place. Many of these events - such as WWII and the New Deal - took place when US population and GDP were vastly smaller than today. (1940 pop = 132M; 2008 pop = 303M) So if you are going to stimulate today's economy, the numbers have to be correspondingly higher.

Chris said...

So far a total of 4,6165 Trillion dollars has been committed to the credit crisis. In todays dollars, nine big government spending programs amounted to 3.92 trillion. This would be 686 billion less than the credit crisis so far.

Check "Bianco Research" then look under Big Bailouts, Bigger Bucks

In spite of what Obama said, there is a lot of pork in these bailout numbers. Even ACORN gets a slice.

Anonymous said...


Congress passed a $700B package at Bush's request. The headlines are now about another $800B. Are you suggesting the feds somehow snuck another $3T in under the radar?

If so, I don't think it's been Larry drinking the cool-aid.

Anonymous said...

Just checked your source, Chris. It states that $4.6T figure without explanation or attribution.

Chris said...

I was confused too but apparently the bailout of Wall Street is not limited to the 700 billion plus the latest 800 billion. The total number is more like 8.7 trillion, or as ABC news put it "half the value of all the goods and services produced in the United States last year." This is officially, "the most expensive single expenditure in American history."

The historic cost of these bailouts is just the tip of the iceberg. Think of the productivity, wealth, and entrepreneurship lost to the sinkhole of government disfunction.

Anonymous said...

Still no source or explanation of that number, Chris ...

Anonymous said...

4.7 trillion... 8.6 trillion... do I hear 15 trillion?

(Overheard at the auction going on inside Chris' head)

I heard that the new bailout is actually going to be eleventy threeve kazillion dollars. But I heard it from Rush.

Chris said...


ABC news: Financial bail out balloons to the trillions

This says potentially 7.5 trillion--heck what's a trillion less- this was last November so it probably went up.

Anonymous said...

Chris, you're obviously making numbers up...

Anonymous said...

Okay, here's the story Chris is apparently relying on:

It does say the "bailout" will "cost" $7.5T, but comes up with this figure based upon anything and everything the government is doing, whether it actually costs any money right now or not. For example, if the govt is guaranteeing something, this number assumes the worst, that the asset will crash and be worthless, leaving the govt holding the bag. It is a classic example of a worst-case-scenario attention grabbing headline that in any other context Rush and cronies would be poo-pooing. Only this time they like it - so they quote it.

I for one am not buying this number. If it gets this bad, we'll all be hawking apples on the street and standing in soup lines anyway. Reality will be so bad we won't really care about the numbers.

Charles said...

I tend to regret mentioning facts around Chris, but then she rarely responds once we start, so here goes:
1) The Depression was worsened by Humphrey's "fiscal responsibility" and extended by similar moves by FDR in 1937 - the numbers were looking better until Rush's feces-hurling ancestors threatened him politically.
2) The subprime loans were rarely made to poor people, although every one that was has made its way into the national media. It was middle class - often upper middle class, even the rich, borrowing more than they should have been able to, to buy that extra 2000 square feet of house on the golf course, or investment properties to flip in a year because real estate always goes up. Those are the properties being abandoned, and the majority of foreclosures. I won't claim the poor are better people, but the system (which you'd like to think is "free" but is just regulated by the rich instead if the government) kept their hands out of this cookie jar like it does most others.

Larry, thanks for giving us an example of loving patience in the face of such small-minded bile.