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CONTRIBUTORPolitical economy Opinions expressed by Forbes Contributors are their own.
During the pope’s visit to the United States, he praised globalization and called business a “noble vocation” while also calling for inclusive capitalism. This message is one that conservatives like Brian Kilmeade seem to have missedin their denunciation of the pontiff. While some may not agree with Pope Francis on every political issue, many for-profits collaborate with NGOs to tackle global poverty, and these causes speak the language of what activist Arthur Brooks calls the conservative heart.
An impoverished Indian eats food handed out as an act of charity at the end of the day in New Delhi, India, Thursday, Oct. 1, 2015. Some 800 million people in the country live in poverty, many of them migrating to big cities in search of a livelihood and often ending up on the streets. (AP Photo/Saurabh Das
Just last week, the India-based megafirm Tata Communications and credit card giant MasterCard MA -1.08%announced a Clinton Global Initiative Commitment to Action to provide cell phones to 25,000 women in the developing world, with the bigger goal of reaching 100 million women as an estimated 3 billion people come online in the next ten years. This Tata/MasterCard initiative aims to be a for-profit enterprise, and it brings in collaboratorsBrightstar Corp (for profit, cell-phone provider), Kiva and Trickle Up (microfinance lenders).
“In our generation we believe that we have a very unique opportunity to unshackle women from cycles of poverty and dependency,” Rangu Salgame, CEO of the growth ventures group at Tata Communications, told me. “We have a very inquire opportunity to do this on a scale that is unprecedented … big problems of the world will be solved by bringing together private sector, public sector, governments, and civil society.”
Salgame said maturation of both smartphone technology and microfinance lending have converged so that poor families (and data show it’s primarily women who are drivers of poverty alleviation) now have access to cheap mobile phones where they easily can conduct online banking and transactions. They can use phones for advancing health and education, growing lifespans and enriching minds. This is compassionate capitalism.
Johnson & Johnson JNJ -0.7% blazed trails in fighting the effects of poverty through its 27-year commitment to the venerable Operation Smile, an NGO providing free cleft surgery and care in more than 60 countries. Now J&J is moving into the for-profit arena through sponsoring an innovative new venture, the Triumph Games, created by Mary Hagy. She’s a Gulf War Army veteran troubled with how the media too often depicts veterans as damaged goods: mentally ill, homeless or unemployed.
Hagy launched the elite competition to challenge this narrative by telling stories of veterans’ grit and stunning athleticism. The Triumph Games will be broadcast October 17 on the NBC Sports Network to showcase men and women who have served honorably in the military, suffered a catastrophic physical injury during their service and previously medaled nationally or internationally in some sport. Hagy told me she structured Triumph Games as a for-profit venture to free up more dollars for non-profit services for veterans. Money for Triumph Games from J&J and other sponsors like Goldman Sachs comes from advertising budgets, not corporate social responsibility (CSR) funds often flowing to non-profits.
Hagy’s concern about the sustainability of veteran non-profit groups is similar to many conservative activists worries about poverty alleviation here and abroad. It taps into the old adage of giving away fish vs. teaching how to fish. At home and abroad, for-profit enterprises introduce prosperity that is more durable and self-sustaining than mere direct aid.
We just got World Bank projections that 702 million people, or 9.6 percent of the world’s population, will be living in extreme poverty in 2015, a drop from 902 million people or 12.8 percent in 2012 (my Competitive Enterprise Institute colleague Iain Murray suggests that based on World Bank methodology changes, this percentage should be even lower). These percentages are dramatically lower than even a generation ago as capitalism expands.
It is possible, and empirically proven, that a company can make a profit and also make a positive difference. Democratic candidate Bernie Sanders doesn’t seem to get this in his calls for endless expansion of government handouts. Yet many of the 2016 Republican candidates don’t know how to channel a positive message of compassionate capitalism in a way that resonates with audiences at home and around the globe. And rather than pillorying Pope Francis, conservatives might want to figure out just how he’s been able to capture the global imagination for his agenda.
