A renewed focus on social capital

Rethinking our dependency on financial capital for a post-pandemic world

PHOTO: Daily Star

One of the key revelations of the Covid-19 pandemic is that things that we held to be true in the past are now seen to have been myths, and as we transition from the old order into a new (and hopefully better) order going forward, we can build a better world by fixing much of what was wrong with the old world.

Today, I will share some thoughts on how we need to focus on enhancing social capital as a priority in place of our over-reliance on financial capital, which has dominated our thinking for so long.

Let me start by picking a few aspects of the prevalent financial capital paradigm that are proving to have been myths. First is to acknowledge that when money is needed, governments can produce it to save what they feel are high priorities. Hence, trillions of dollars are now being made available when we were told that there was no money to do the same things we have to do now. It is clear that lack of money was never the main constraint, but rather the priorities for which it was allocated. Investment in proper public health planning has been neglected, as has tackling climate change, with the excuse that there was no money available. At the same time, money for weapons never seemed to be in short supply. Today, we are seeing the most expensive machines of war, namely the aircraft carriers, being grounded by Covid-19.

A second myth that is being exposed is that the billionaires are the most valuable members of our society. They are now sitting at home while their food is being delivered by low paid delivery workers, making it apparent that the money that they have has nothing to do with their value to society. Indeed, every year there seems to a competition amongst the billionaires to see how few of them can accumulate more money than the rest of the world. This upward flow of capital from everyone else to just a few billionaires needs to be rectified by adequate taxation.

A third factor that we are now recognising is that professionals like doctors, nurses, teachers and health workers are not paid any where near their value to society, even though they are the ones facing coronavirus to keep the rest of us safe. These people have invested time and worked hard to become professionals, not to become high earners, but rather to help their fellow human beings. They need to be better recognised (which is happening now) but also better paid in future.

So as we move forward to deal with the current crisis in public health and then towards tackling the climate change crisis, we should look to invest in building social capital and not allow financial capital to dominate as much as it did before. This is not to say that money is not important, but rather to argue that those with the billions should no longer be allowed to decide where to invest. Investment strategies must be targeted at what society deems most valuable.

So how might this work in practice? The following are some suggestions in the context of Bangladesh, but these ideas are also applicable in other countries and indeed at a global level as well. We can start with two major assets that Bangladesh already has, and then suggest ways to build on them. The first asset is that Prime Minister Sheikh Hasina is already well convinced about the need to invest in Bangladesh’s social capital and has put in place policies to make this happen.

Unfortunately, while Bangladesh is good at adopting good policies on paper, we often fail to implement them in practice. Now is the time for the Prime Minister to ensure that her political followers, as well as her bureaucrats and the defence forces, are galvanised to work for the people against Covid-19 now, and against climate change after that.

The second major asset of social capital that we have are our NGOs, in which many thousands of professionals are working to help their poorer fellow citizens, and not only for their salaries. We have the biggest NGO in the world in BRAC, as well as the pioneer of micro-finance in Grameen Bank. Indeed, Professor Yunus was the person who showed us that the social capital of a group of women could replace the collateral that a traditional bank would require when giving a loan to anyone. These NGO workers are a major social capital that can be galvanised to deal with the Covid-19 pandemic as well as climate change going forward. On the Covid-19 front, we are also seeing Dr Zafrullah Choudhury’s Gonoshasthaya Kendra stepping forward with cheap tests for the virus.

A third aspect of substantial social capital in Bangladesh is our university and research sector, who are producing quality research that can help decision-makers at local, sectoral as well as national levels going forward. Finally, the people of Bangladesh themselves are our biggest social capital, if we can invest in educating and empowering them effectively. The health workers are the ones we need right now to tackle the public health crisis but our farmers, fishers and factory workers will all need to be brought into the struggle to tackle both Covid-19 and climate change.

What we need is a dynamic all-of-society approach to give us the necessary ability to link up all the different sectors of our society, enabling us to work together for a common purpose. Out of crisis also comes opportunity to make things better than before, but only if we take it.

Originally this article was published on April 29, 2020 at Daily Star. The author Prof. Saleemul Huq is the director of the International Centre for Climate Change and Development (ICCCAD) at the Independent University, Bangladesh (IUB).
Email: saleemul.huq@icccad.net