ITEM ONE



On Monday evening, I was privileged to attend an event in Champaign where Nobel Peace Prize winner, Muhammad Yunnus spoke.  Dr. Yunnus was a young economist in impoverished Bangladesh in the 1970's, when he developed the concept of micro-lending, essentially loaning small amounts of money to poor people so that they could start their own business.

Specifically, Dr. Yunnus was driven to give opportunity to the poor women of Bangladesh by making them entrepreneurs.  A loan of less than $25 allowed a single woman to purchase a used sewing machine, so that she could make clothes to sell.  Similarly, women were offered a small loan to purchase a rudimentary oven to start a small bakery. 

Dr. Yunnus' concept worked.  Today, his bank, The Grameen Bank, makes an average of $1.2 Billion in loans every year.  The average sized loan?  $20!!   And millions have been lifted out of poverty.

The first part of his journey was the creation of his incredible bank and opportunities for the newly minted entrepreneurs.  The second part was equally fascinating.

Dr. Yunnus recognized that many of his borrowers were escaping generations of poverty.  But to insure that escape, he promoted education, with both a carrot and a stick.  First, he required, that to remain eligible for a loan, the children of his customers must stay in school.  (Call that the stick).  And, children graduating from high school were then eligible for Grameen Bank student loans (the carrot).  The results were incredible.

One quick story he noted was of the illiterate mother who used a small loan to build a small business enterprise.  Because of Dr. Yunnus' carrot and stick approach, the illiterate mother's daughter is the community physician just one village away.  From illiteracy to medical doctor in just one generation, simply by requiring responsibility from those receiving a loan.  Pretty remarkable.

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ITEM TWO

Berkshire Hathaway is one of America's largest companies.  It is run by the genius investor, Warren Buffet.  Mr. Buffet produces an annual letter for his shareholders that is always a fun read.  (Full disclosure:  I am NOT a shareholder.  Although, at $122,000/share, I would be well satisfied owning only a couple dozen shares)  In this year's letter, Mr. Buffet credits his success to the fact that he "had terrific parents who insured he got a good education".

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ITEM THREE 

Driving to work, the radio news described the sorry state of affairs in Illinois (and across the nation) concerning the alarming drop out rate among high school students.  Of course the drop out rate is an early indicator of future felons and state burdens.  It looks to be increasing at an even faster rate.  

Taking advice from Mr. Buffet and Dr. Yunnus, education is certainly the most critical element to eliminating poverty.  But Dr. Yunnus, properly applies responsibility for education to the parents.  In fact, he conditions that responsibility as part of his lending practice.

The United States Government and our state politicians provide enormous relief for victims of poverty in the form of welfare checks, food stamps and other programs.  But what responsible action do we require of the recipients?

What if we added a simple requirement for our welfare recipients?  If you receive a welfare check or food stamps, your child cannot miss more than a certain number of days of school.  Illnesses excepted, if your child misses too many days, the amount of money in the welfare check begins to reduce.  

Thus, the only responsibility we are asking of the recipient is that they begin to act like a parent.  It doesn't seem to be that much to ask.  Education, insured by his parents, helped Warren Buffet succeed.  And forcing parents to act like parents, is a program that's proven to work by the winner of a Nobel Peace Prize.