By **Jake Whitney**
On March 2, Muhammad Yunus, the 2006 Nobel Peace Prize winner, was abruptly forced from his position as managing director of Grameen Bank, the Bangladesh-based financial institution he founded thirty years ago. Though he is appealing the decision to Bangladesh’s Supreme Court, his government ousting has been confusing and controversial. The official reason given was his age. Yunus is seventy. The mandatory retirement age for public workers in Bangladesh is sixty. But his supporters immediately cried foul: the Bangaldeshi government owns just five percent of Grameen Bank, so it is not a public institution. And even if it was, how come Yunus wasn’t “sacked” years ago, given that he’s a decade past the age limit?
Yunus’s supporters insist his firing was political, the culmination of a witch hunt that began four months ago. That’s when a documentary aired on Norwegian television that attributed glaring improprieties to Yunus and his bank, including the charge that millions of dollars vanished from it in the nineties. An investigation by the Norwegian government declared these claims to be baseless, but his supporters assert that Bangladeshi Prime Minister Sheikh Hasina exploited the controversy to settle a long-standing score with Yunus. You see, she believed that she deserved a Nobel for signing a peace treaty in 1997; and she was reportedly furious with Yunus for implying that her government was corrupt when he toyed with the idea of launching a political party in 2007.
This is a strange brew of charges for a Nobel Laureate to be embroiled in, to be sure, and the case has received wide attention. But virtually lost in the hubbub has been the key issue at stake: the monumental problem of global poverty and how best to alleviate it. A staggering one out of every five people on this planet remains mired in absolute poverty. Think about that for a moment. While many of us are banging away on our Droids and nursing $7 lattes, one and half billion others lack life’s basics: indoor plumbing, electricity, clean water, enough food. How best to help them is one of the great questions of our age, and Yunus won his Nobel because of his novel approach, and success, in confronting it.
[B]y definition a revolutionary upsets the status quo, and in doing so Yunus has become a target.
Before Yunus, the poverty debate was focused on two potential solutions: Western aid or foreign development. Regarding aid, the evidence from Africa—billions of dollars over decades had only resulted in a poorer continent— suggested that it could be more destructive than beneficial. The development model, which had had some successes, brought its own set of problems. Foreign corporations had long histories exploiting native workers, polluting local environments, and undercutting native industries. Yunus did not believe these models were sustainable, so he pioneered a new one: microfinance—the idea that tiny loans to the impoverished would allow them to start businesses and lift themselves out of poverty. A family with few resources could use a microloan to buy a cow, for example, and sell its milk. Or sell its calf to buy land.
Melancho and her husband did just that. Farmers in a flood-ravaged region near the Indian border, they used a 5,000 Taka ($70) loan to buy a small cow. When the cow gave birth, they sold the calf and bought more land, which they farmed successfully. As their farm grew, they were able to earn a steady income and educate their three children. Melancho’s story is told by the filmmaker Holly Mosher in her upcoming documentary about Yunus, _Bonsai_. “What has changed since Grameen came here?” Melancho, a petite young woman who was married at thirteen, is asked in the film. “Everything is really good,” she answers, smiling proudly. “The kids are clean and going to school. We don’t have problems now.”
Success stories like Melancho’s are not universal, of course. As microfinance has moved into other countries, it has been criticized for being overly profit-driven. The Indian government is investigating eighty suicides of borrowers who were reportedly distressed after defaulting on microloans. And though Grameen continues to maintain an astounding ninety seven percent repayment rate, some believe the bank’s success has been over-hyped. Nevertheless, Grameen has pulled millions from poverty, with 8.2 million borrowers in total. In addition to microfinance, Grameen is involved in health care, education, community organization, and even alternative energy. It’s focus on lending to women has empowered countless numbers of them—almost all Muslims—to become community leaders.
All told, Yunus’s contributions to ending world poverty have been gargantuan, and his approach revolutionary. But by definition a revolutionary upsets the status quo, and in doing so Yunus has become a target. The Scandinavian documentary was a hit job. And though no real evidence yet exists that Prime Minister Sheikh Hasina fired Yunus because of a vendetta, her turn on him has been striking: a decade ago she was “proud of the outstanding work” he’d done; today she calls him a bloodsucker of the poor. But he is not. Through Grameen Bank, Muhammad Yunus has made entrepreneurs of beggars, and community leaders of the disregarded. The very least the Bangladeshi government can do in return is let him step down when he chooses. The Supreme Court hearing is set for March 29. Let’s hope justice is served.
Copyright 2011 Jake Whitney
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Jake is a writer originally from the Bay Area who now lives in Westchester. His work has appeared in a wide range of publications, including The New Republic, The San Francisco Chronicle, Editor & Publisher, New York magazine, The Huffington Post, and many others. Jake holds a Master’s degree in journalism from Iona College. His most recent piece can be read here.
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