While clearly the central theme of this year's World Economic Forum meeting was climate change, the secondary focus was squarely on the poor. This follows a vote by attendees at last year's meeting naming poverty the top issue to be dealt with in the world.
What gives? Related Link Return to Viewpoints: Messages from DavosWhat gives was a novel big idea: The poor represent a genuine emerging-market opportunity, if one wholly missed until now.
Here at Operation Hope, we call it "banking on the poor." It's the same sort of opportunity as our Banking on Our Future program, which has educated more than 200,000 low-wealth youths in financial literacy here in the United States. We will soon be taking this program to South Africa in partnership with Citigroup, the World Bank, and others I met at last year's meeting.
There's a genuine opportunity for the private sector to find new customers and for governments to find taxpayers while fixing the fabled Jericho Roads of the world.
And it means taking a second look at microcredit as something serious, something much more than a less costly form of philanthropic giving for the poor, which many proven leaders actually did at this year's meeting.
It is telling that the recent Nobel Peace Prize winner was himself a banker, and a member of the forum, specializing in providing microfinance with razor-thin loss ratios that would rival any traditional mainstream bank.
In the innovative Davos talks about microfinance and microcredit, many conservative and sober thinkers in the banking sector went so far as to suggest that the very existence of microfinance was an indication of the failure of the traditional banking sector in serving the poor.
Prominent bankers and business types at the meeting raised the idea that the newfound, growing success of microfinance and microcredit should naturally lead, in time, to banks' buying many of these leading microcredit providers and assuming their role as providers of credit to the poor, albeit on a much larger scale.
And as controversial as this discussion was — along with the parallel discussion around a noted microlender with a substantial loan portfolio going public — it is precisely the discussion that should be taking place.
Because in order for these good and worthwhile efforts to be sustainable, or for the Community Reinvestment Act here in the United States to continue to be viable, they must at some point lead to true emerging markets, and they will.
Done right, microcredit, like some of the work in this space being done by Citigroup, Deutsche Bank, and other big banks around the world, can not only help the least of God's children, but also help open the door to a positively explosive second wave of business growth for a sector gone rigid and in need of a little reinvention.
When the more than 3 billion people on this planet living on less than $2 a day gain access to practical and useful financial services and are able to subsequently become entrepreneurs and self-employment projects, everyone wins.
Here in America, the CRA will have to undergo the same positive metamorphoses as it continues its historic march from a focus on handouts and charity to a focus on legal compliance, a focus on targeted lending, investment, and service, and an ultimate focus on low-wealth communities as true emerging markets.
I was fascinated to see not only that our work in financial literacy education was thought to be as applicable, useful, and necessary in Rwanda as it is in the inner cities of South Central Los Angeles, but also that serious companies have been making serious commitments.
E-Trade, which was in Davos, has partnered with us to open a center in Harlem, in partnership with the Clinton Foundation. The New York Stock Exchange, whose president and chief executive officer I originally met in Davos, is now a full partner with Operation Hope, with countless exchange employees mobilized every week in New York-area schools and classrooms teaching our children financial literacy.
And five months after meeting World Bank President Paul Wolfowitz at Davos last year, we, together with Federal Reserve Chairman Ben Bernanke, kicked off the first-ever Anacostia Economic Summit just outside Washington — for the poor, mind you.
Something serious is happening in the world today, and increasingly it is being innovated out of the mind of the private sector, specifically leaders and innovators in banking. That something serious also is being actively incubated in Davos at the annual World Economic Forum meeting.
Helping to make capitalism and the free enterprise system actually work for the poor is the last piece of unfinished business in America and the world over.