Steve Hutcheson

Capitalism as we know it is perhaps at a crossroad. It may have reached a position in the way we live our lives that only social disorder will resolve some of the difficulties we are now facing unless new options are created to alter the way our communities co-exist. Presently hundreds of millions of people around the world have been affected by the fallout of the financial collapse that has occurred over the past year. Millions upon millions are presently unemployed; countless millions of others have lost their homes and lifestyles and again hundreds of millions if not billions have suffered financial loss through the collapse of investments.

Part of the problem is the development of unfettered capitalism, the belief that the acquisition of more and more wealth is immutable and inscribed in stone. Thirty to forty years ago the salary difference between the lowest and highest in any organization may have been in the order of three to four times. Now differences in compensation in the hundreds of times are not unusual. It raises the question of how much additional contribution the highest paid is making to the overall success of the operation.

I was once complimented in that as the former manager of a program in Afghanistan and after considerable absence I gave credit and greeted as a friend a humble man whose single role was to open and close the gate as we entered the compound. As I explained to my engineer, I saw that the gatekeeper’s role was as important to the overall operation as anyone. If he was not vigilant in his task to secure the compound as he did, we were all at risk and in that respect he was critical to the safe operation of us all. The same can be said in any organization today.

People and governments however in another respect are intrinsically generous.  For the past decade I have had the good fortune to have been engaged in dispensing some of the universal largess in some of the world’s more difficult crisis zones, Kosovo, Afghanistan, Aceh and to a lesser extent Thailand and now Malaysia. People with the most have been the most generous. Bill Gates has contributed billions in the fight against malaria; countless trusts have been established by philanthropists worldwide to engage in social restoration, building schools and clinics or simply provide financial aid and hundreds of millions of people have contributed to millions of charities and social programs worldwide. From my own small involvement I have been given the managerial task to dispense more than two hundred million dollars over the period I have been working in these operations.

 But in all the time I have been involved in this line of work I have questioned the overall impact that all this generosity has made in solving the problems of half of the world’s population. If we provide aid today, we often need to provide more aid tomorrow. I liken it to placing a dollar in the cup of a beggar. We don’t solve his problem since he will most likely be there again tomorrow. We take on a role of Benefactor and Beneficiary where one party is always kept at a disadvantage and is unlikely to become our equal.

Since 2002 more than thirty billion dollars has been provided in direct aid to Afghanistan yet they still have the worst social indicators across all measures of all the countries in the world. The aid program has not been successful. We have however perpetuated the roles of benefactor and beneficiary without developing any sort of successful partnership between the two parties.

I firmly believe it is now time to address this particular issue directly. If I give you something, I want you to something in return to develop the partnership. I was heartened to see an article recently about an admirable young Sudanese man, Valentino Deng who has been moderately successful in the US and is now actively working towards building schools in his own country. He view is that “he is the lucky one so it is incumbent upon him to help his people solve some of their problems.”

In some ways, (I am an engineer so am taking an engineering approach to developing a solution) I believe that for the most part, people are prepared to work. Over the years I have employed more than 60,000 people on cash for work programs and I know and they know that the money we would hand out each week was theirs, they had earned it. But the question that always niggled me was the lack of sustainability these programs had. We would employ a thousand people for three months to construct a road to market for some isolated community. At the end of the project however, there was no continuing work for the thousand engaged in the process.     

Presently UNESCO has listed part of Penang to be a cultural and social World Heritage site. That in itself has created something of a commercial flurry in the development of the region however the most likely scenario is that it will become a gentrified enclave, eliminating in its progress the lifestyle and social framework of those that presently live within its boundaries.

The solution as I see it is to put the property development aspect required for Penang to work in conjunction with the social development work that is necessary to retain the social and cultural structures as they are. Through this there is also an opportunity to modify our approach to dealing with the social issues of the disadvantaged such that we arrive at sustainable outcomes and that problems are not simply solved only for as long as the aid continues, we enable the poor and disadvantaged to reach a position where they no longer require aid. That then brings into account a new means of addressing social philanthropy, philanthropy that enables the poor to have sustainable incomes and permanent jobs where they are in partnership with those that provide them the means to achieve that status, the benefactor and the beneficiary are as equals.

To do this requires the philanthropist to become not simple the benefactor giving alms to a beneficiary but working as the financier providing soft loans that need to be repaid and as that is returned providing further soft loans to start more projects and so on and so on all the while retaining a direct connection and equity with the process.  It is not simple one gives and the other takes, they both have a common objective and outcome in mind. Perhaps that is a solution to address the existing faults of capitalism. It is one that I am certainly working on.