What then must we do?

The question was raised by Leo Tolstoy in an essay written in 1886 at the time of the Moscow census. It is a question raised also in a new book about the next American Revolution:

I came across the work only a couple of years ago when reflecting on the impact of my late colleague in putting love and compassion into economics. This extract was perhaps the most relevant:

“Good consists not in the giving of money, it consists in the loving intercourse of men. This alone is needed. Whatever may be the outcome of this, any thing will be better than the present state of things. Then let the final act of our enumerators and directors be to distribute a hundred twenty-kopek pieces to those who have no food; and this will be not a little, not so much because the hungry will have food, because the directors and enumerators will conduct themselves in a humane manner towards a hundred poor people. How are we to compute the possible results which will accrue to the balance of public morality from the fact that, instead of the sentiments of irritation, anger, and envy which we arouse by reckoning the hungry, we shall awaken in a hundred instances a sentiment of good, which will be communicated to a second and a third, and an endless wave which will thus be set in motion and flow between men? And this is a great deal.”

This endless wave which flows between men is reflected in The Law of Love and the Law of Violence 

“The ideal of Ant Brothers clinging lovingly to one another, only not under two armchairs curtained by shawls, but of all the people of the world under the wide dome of heaven, has remained unaltered for me. As I then believed that there was a little green stick whereon was written something which would destroy all evil in men and give them great blessings, so I now believe that such truth exists among people and will be revealed to them and will give them what it promises.”

The issue of poverty and eradicating it, as both a moral and strategic imperative, was the focus of a paper written by my colleague for the US President Bill Clinton in 1996. In it he described a business model for socal benefit:

"This business model entails doing exactly the same things by which any business is set up and conducted in the free-market system of economics. The only difference is this: that at least fifty percent of profits go to stimulate a given local economy, instead of going to private hands. In effect, the business would operate in much the same manner as a charitable, non-profit organization whose proceeds go to local, national, and international charities. Non-profits, however, are typically very restricted in the type of business they can conduct. In the United States, all non-profits must constantly pay heed that they are not violating those restrictions, lest they suffer the wrath of the Internal Revenue Service. For-profits, on the other hand, have a relatively free hand when it comes to doing business. The only restrictions are the normal terms and conditions of free-enterprise. If a corporation wants to donate to its local community, it can do so, be it one percent, five percent, fifty or even seventy percent. There is no one to protest or dictate otherwise, except a board of directors and stockholders. This is not a small consideration, since most boards and stockholders would object.  But, if an a priori arrangement has been made with said stockholders and directors such that this direction of profits is entirely the point, then no objection can emerge. Indeed, the corporate charter can require that these monies be directed into community development funds, such as a permanent, irrevocable trust fund. The trust fund, in turn, would be under the oversight of a board of directors made up of corporate employees and community leaders. "

Soon after he became homeless and remained so for two years until an economic crisis hit Russia, where Tolstoy had contemplated what must be done more than a hundred years earlier He gathered all the resources he could muster and chose the Siberian city of Tomsk as his target. He reported back to Clinton, suggesting nothing less than the inversion of preceding top down development intiatives to put resources in the hands of those needing it most - people in poverty.    :

"The basic ingredients existed that I thought were needed for an economic resurrection.  The population of 600 thousand people were generally very well-educated among six universities in the city.  Internet was available, but limited to a 1 MB link that was parceled out and distributed among universities, businesses, and citizens.  Government was largely reform-oriented towards democracy and market economy.   Tomsk was the primary telecommunications node between Moscow and Vladivostok, making it an ideal location for replicating successful project components.  Small businesses were beginning to flourish despite severe financial constraints following the financial collapse of August 1998.

There were also critical food shortages in the region, children living on the streets because they considered orphanages intolerable, women having to resort to prostitution to feed their children, and a near-total lack of new economic opportunities.   Economic opportunities for women were routinely negotiated in bed, if at all."

The recommendations would lead to what became known as the Tomsk Regional Initiatve, a microenterprise development project which launched 10,000 small enterprises, with more than 80% created by women:

$6 million investment was leveraged  for a moral collateral microfinance bank run by Finca which becam self sustaining in its second year. 

It is perhaps ironic that one who'd had a oart in lifting so many others out of poverty should remain in poverty himself. In 2003, he fasted from a tent in North Carolina for economic and social rights. This is where I became involved, suggesting he join me in the UK.

I passed on his communications to senator John Edwards during the fast and in 2004, sent his letter to Edwards about the coming election where he stood with John Kerry:

"Your final ticket and the ticket to economic transformation in America is, oddly enough, American people.

I worked through this theme eight years ago, in a paper for Clinton’s reelection steering committee.  After 35 pages of methodical analysis, and six weeks of debate with any and all challengers in Chapel Hill area prior to the paper being finalized and released, it reduced to a concept called people-centered economic development.  No one along the way prevailed in any debate on the matter, and no one since then has disagreed in any way with the conclusions.  In fact, since 1998, Yale, Stanford, Duke, Harvard, and Oxford business schools have embraced the arguments in the paper as a new, formal economic paradigm.  The government of the United Kingdom of Great Britain has, as of 2002, included the paradigm as formal UK economic policy.  Those are all under the shortened banner of ‘social enterprise.’

When interviewed that same year about his approach, he told a diaspora leader for Crimea's Tatars:

"At first, the idea seemed heresy - but not for long, simply because it made sense and it didn't step on the toes of any existing enterprises that were in business to enrich relatively few people. None of them were asked to change anything, but it left open the possibility of more forward-thinking people to step in and do business differently. Even now, I am astonished that the idea struck such a deep and sympathetic chord in so many people so quickly - especially in our top business schools, where one might have thought that they were all in it for the money, for personal wealth, with little regard to social benefit or the poorest of the poor."

With a business plan to tackle poverty in the UK, it was introduced to the social enterprise community and British government in 2004 with this suggestion:  

"Traditional capitalism is an insufficient economic model allowing monetary outcomes as the bottom line with little regard to social needs. Bottom line must be taken one step further by at least some companies, past profit, to people. How profits are used is equally as important as creation of profits. Where profits can be brought to bear by willing individuals and companies to social benefit, so much the better. Moreover, this activity must be recognized and supported at government policy level as a badly needed, essential, and entirely legitimate enterprise activity.”

That same year government were constructing legistation for the community interest company as described in the New Statesman.

In 2006 he delivered a 'Marshall Plan' strategy to Ukraine's government based on the bottom up localised development approach which had been so successful in Russia, it would suggest that 1.5 billion dollars being spent then every week in Iraq could be deployed over 5 years where democracy was more welcome:

"This is a long-term permanently sustainable program, the basis for "people-centered" economic development. Core focus is always on people and their needs, with neediest people having first priority – as contrasted with the eternal chase for financial profit and numbers where people, social benefit, and human well-being are often and routinely overlooked or ignored altogether. This is in keeping with the fundamental objectives of Marshall Plan: policy aimed at hunger, poverty, desperation and chaos. This is a bottom-up approach, starting with Ukraine's poorest and most desperate citizens, rather than a "top-down" approach that might not ever benefit them. They cannot wait, particularly children. Impedance by anyone or any group of people constitutes precisely what the original Marshall Plan was dedicated to opposing. Those who suffer most, and those in greatest need, must be helped first -- not secondarily, along the way or by the way"

in 2008, he wote to USAID and the Senate Committee on Foreign relations calling for their support to "establish an alternative form of capitalism, where profits and/or aid money are put to use in investment vehicles with the singular purpose of helping the world’s poorest and most vulnerable people "

His letter concluded

"Thank you for your time and attention to this. I and others will look forward to hearing from you. I hope we continue to realize ever more fully that outside the box and inside the box have only a box in the way. We outside the box know quite a bit of what’s going on, many times in exquisite detail, perhaps in ways that those inside the box can’t quite as easily access if at all. We are grossly underfunded in favor of missiles, bombs, and ordnance, which is about 100% backwards. Now, with even the US Pentagon stating that they’ve learned their lesson in Iraq and realize (so says top US general in Iraq ten days or so ago) that winning hearts and minds is the best option, I and others shall continue to think positive and look for aid budgets and funding spigots to be opened much more for people and NGOs in silos, foxholes and trenches, insisting on better than ordnance, and who understand things and how to fix them. We can do that. We can even do it cost-effectively and with far better efficiency than the ordnance route. Welcome to our brave new world. Except it’s not so new: learn to love and respect each other first, especially the weakest, most defenseless, most voiceless among us, then figure out the rest. There aren’t other more important things to do first. This message has been around for at least two thousand years. How difficult is it for us to understand?"

 

 

   

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