In society there is a big emphasis on the tallest, fastest and strongest. Winners make big headlines. So it is no wonder that the recent flurry of announcements about 2006 Nobel Prize winners garnered so much attention, especially with so many Americans being recognized.
Six Americans were awarded Nobel Prizes in fields including chemistry, physics, medicine and economics. Initially, my thought was America’s higher education system isn’t doing as badly as some might think. Two prizes away from a sweep is not bad until you consider that these awards reflect a lifetime of past achievements and not necessarily current educational dominance.
But the real value in reading about these prizes is that some reflect very understandable ideas. Sure, those science winners like to come up with new processes I probably can’t pronounce, but the discoveries add to people’s understanding of the world. While some of the other accomplishments seem to shed light on the obvious, they do so ahead of their time.
As an economics major, albeit a slightly nerdy one, imagine my excitement when I heard that an economist won the Nobel Peace Prize. Muhammad Yunus, a 66-year-old Bangladeshi economist who received his doctorate at Vanderbilt University, received the prize for his work in extending micro-credit loans to the impoverished in Bangladesh.
Yunus utilized the entrepreneurial drive of the people he met to extend small denomination monetary loans that change people’s lives. After 30 years and $5.7 billion in loans, he can show achievement through the successful repayment of 98.5 percent of the loans. Further, according to an interview in Time magazine, Yunus said “58 percent of the poor who borrowed from Grameen (the bank he created) are now out of poverty.”
Essentially what Yunus has been able to achieve – which has subsequently been adopted in more than 100 countries – is a way to extend credit to those who traditional banks would shun as having insufficient collateral. His idea was to extend loans to groups of villagers using the reality that none among them would want to be publicly shunned within the community for failing to repay the loans. His only collateral for these loans is a sort of coercive, peer pressure capital.
Interestingly, Yunus believes charity is the wrong answer to alleviate poverty. He states on his Web site, “It creates dependency and takes away individual’s initiative to break through the wall of poverty.”
The success of Yunus’ approach to empower even the most destitute has gained the attention of those such as Bill and Melinda Gates, who gave Yunus’ foundation $1.5 million last year.
So what do college students have to learn from a man like Yunus? It is important to focus on how many professors’ intellectual rants apply to the world. As a university professor, Yunus found he was disillusioned by the incompleteness of economic theory. Obviously a well-read individual, Yunus now says, “Nothing in the economic theories I taught reflected the life around me.”
Take two of the most common assumptions all economics majors are taught – individuals maximize their welfare, and they act rationally. Obviously these assumptions help to make ideas more palatable and the math easier, but to believe the world operates in a perfectly rational and ideal way is laughable.
As students, there should be a desire, even a requirement, to gain knowledge that will help communities with the problems they face. In this way, the spillover effects of education will have a greater net benefit on those unable to afford to sit in lecture halls, pay tuition and purchase oversized tomes.
But apparently that is not the goal of most students today. Betterment of the world seems to take the backseat to making lots of money. In one of my classes, when students were asked about why they attend college, most seemed to believe that college serves as a tool to facilitate a well-paying job – a way to signal to future employers a student’s ultimate worth. Apparently going to school to gain knowledge must be an archaic concept.
Yunus was disillusioned by economic theory that did not address the needs of the people of Bangladesh who struggle with famine and economic wants. This is not to say that intellectual banter and abstract ideas didn’t play a role in Yunus’ educational achievement, but how much more important is it to make a real difference in people’s lives?
The focus, especially at public universities, needs to be on improving the lives of the people who subsidize education rather than ideas that serve little practical use and only alienate campuses from the realities of the world. After all, if the shoe was on the other foot and you weren’t able to attend college due to some hardship, wouldn’t you hope that someone at the university was actively studying and finding ways to make your life better?
Aaron Hill is a senior majoring in economics.