Learning from Leaders in Mexico

Have you been wondering about the life of The Mindful Compass?  Of course you known that books have their very own special life course.  Life goes on for books almost totally separately from that of the writer.  

Lets take a trip down memory lane.  As I finished writing the book in March of 2007, clearly I was too busy with my own life to sell my book to publishers.  Partially, of course, I was avoiding a task, which would be long and frustrating. Selling books for an unknown writer is a complex undertaking requiring perseverance, a thick hide and real time sweat and tears.

Just as I was enjoying the magic of summer, Maria Bustos, (a motivated and fun woman I had supervised in the Post Graduate Program at the Georgetown Family Center for a few years) called to say she had talked to a publisher, Heberto Ruz, who really liked the book and had read it in one week.  I was shocked to hear her say he was interested in publishing it in Spanish.

Yes, you could have knocked me over with the proverbial feather.  The only thing I knew for sure was that even though I failed Spanish in high school I trusted Maria.  I had been to Mexico in 2004 to speak at a conference on endometriosis that she organized and was very impressed with the caliber of the people I met there. 

It did not take long to see this might be a better way to spend my time than courting rejection as an unknown writer for the American audience. 

I love being a stranger in a strange land where it was warm and sunny and I could easily remain as a curious outsider.

It took until January of 2008 to make arrangements to go to Mexico City to interview Mexican leaders for my book. 

The people in Mexico were just fabulous, very warm and kind but focused on business. Yes, best of all I was able to interview eight very reflective and articulate men. Each gave freely of their time to consider how relationships might have influenced their ability to be leaders.

You can see there was no master plan. This project just emerged from people talking about possibilities.  Mario Bustos had talked to Francisco Gonzalez, the general director of USEM http://www.usem.org.mx/ and he brought in Heberto Ruz. 

I did have the idea of interviewing people from Mexico rather than sticking with the original ten people I had interviewed.  This gave an additional level of information about the role of culture in forming leaders from a particular region of the world. 

I am deeply grateful for all those who were interviewed and to their family and friends for encouraging these individual leaders in their life’s purpose. 


The individuals who volunteered to describe how relationships shaped their values are also demonstrating that they value openness.  Possibly by being more open, people will learn more about how they operate as leaders.  In a funny way people learn by communicating what they know.  They may not have thought about it or put into words until someone asks them to tell their story, but once they listen to their own words they can see just how the values were formed that have been guiding them.


Dr. Bowen use to say, “If I learn something from you then perhaps you will learn something from me.”  This is optimal in a conversation.

I hope each of you learns as much as I did from these interviews, but I know you will not have as much fun as I did. Being in the moment of the conversation and getting to know people, makes for another level of learning.

Overall it takes real courage to tell your story. It takes courage to be open and not overly restrained about what has been important in how we adapt to the twists and turns that life offers. 
Life offers lessons to us all and hopefully we can learn a few of them from interesting others.

After you read the interviews, you can ask what is important here or is it something that will take a while to jell?  We are social creatures learning by observing others from birth to death.

I will be putting up the interview as I receive permission to do so.  Below is the interview from Francesco Piazzesi and next will be Mario Buzzolini .  The others are Ernesto Valenzuela, Fernando Manzanilla, Jorge Esteve, Ulises Calatayud, Victor Lichtinguer and Don Lorenzo Servitje

Francesco Piazzesi

Francisco Piazzesi and Maria Bustos

Francesco and Maria Bustos at USEM Party for Leaders April 2, 2008

AMS- I am so pleased to meet you after all I have heard about you. I congratulate you on receiving a medal from President Felipe De Jesus Calderon this past Monday for your company ADOBE HOME AID and its work with sustainable housing. 

FP – Thank you.  How would you like to organize this interview?

AMS- Often I just ask people to tell me about their passion and what they wanted to do and then we find out how the family fits into their life story.  How did you find your passion?

FP –Let me start with one step behind. I started in a family business. I worked in a family business. (ITAL Mexican). We make construction equipment and we produce the big gray blocks.

I always had a bug inside to help the people in the community. Perhaps this is due to my romanticism or perhaps because life has brought me a lot of opportunities.   I ask my students, why are you here instead of in Africa?  Why – there must be a higher reason?  It is more than luck.  There must be a higher reason not to be born and die at three years of age. It is not just luck

Carlos Slim is not just lucky.  So why are we here? That is the question.

I always try to help people.  I like to get into something that can help people. That has always been there since I was a student.

AMS -Where are you in your family of origin?

FP – I have an older half sister.  She is the daughter of my mother. My mother became a widow in Italy during the war. Then she married my father. The oldest of my brothers, Paolo, was born in Italy and three others were born in Mexico. One brother died of leukemia at 20 or so, 30 years ago or something like that.  I was 16 at the time.  Then there was Mario and then I was born.  I am the baby of the family.

AMS- We call the younger one, the charming one. Often the parents are beguiled by that child. The youngest have a special ability to bring people into harmony.

I thought, as you were talking, about the role of tragedy in a family in forging loyalty and caring for others. Who knows, perhaps the value of looking out for others might help avoid future tragedy?

FP- In college there was an organization to help people bring water to those who were without fresh water for drinking. I thought, let’s go there. People would say what are you doing there?

After that I worked in the family business. Then in 1985 I said, we need a construction method to help the poorest people build a house. So we looked around and found all this fantastic technology. It was great, except for the price. Then we found some equipment to make this fantastic adobe. But it did not go to the poor families. The well off wanted it for the most expensive homes with swimming pools.  We had worked to make the construction equipment for this adobe material available at a low cost, but the poorer people did not want it.  The well off people wanted it for their beautiful homes.  It was funny.

The poor people wanted to have the cement block.  Adobe was for poor people they said. I could not control these people.  I could say two things 1) you have to pay and 2) you have to work to have a home. “No,” they would just tell me, “My congressman said I would get it for free.”  I would say, “Bring him here and talk to him here.  We have enough money for ten houses and you have to pay so another ten families can have homes. You have to pay and work to make that possible.”

This was fantastic. Here was my passion: to see how the people work with the equipment and thereby transform. It is amazing how these families transform.

We come to the community and they were in these cardboard houses. We stayed with the families for a couple of days.  Then we found that the people who work and take the stress while building the new house change. We went back to see how both they and the houses are doing.

The family who use to live in the cardboard house and this same family in the new house are completely different families.

We did this from 1985 to 1997.  Its like you took the family of the old house and you put them in a rocket to Juniper and a new family returns.

Two hurricanes occurred in Chiapas and wiped out many peoples lives and homes. During Hurricane Pauline, ten thousand people lost their homes in one night.

We were working with the government to rebuild. A Gift for Peace was one of the organizations which helped enable the building of these homes. We did this cautiously with an exchange program.  “You bring your guns (to exchange as a down payment for a new home) and we will give you the help to build your homes.” 

We were there when the hurricane struck.

These people lost their cardboard houses in one night. We worked with the government in a program to rebuild.  I knew we would be able to bring them the opportunity to build their home.  We worked and built 40,000 homes that the families also helped build.


(Photo showing the construction of one of the cardboard homes)

We bring the actors and the materials together. The actors have specific expertise in home building: technology, financial, NGO’s and the local and national government agencies.

We did not manage the money, we asked for the needed supplies. We would say we need 10,000 pounds of concrete, and it was there.  We asked for ten trucks and they were there.

AMS – What a difference from Katrina.

FP – Yes, everyone helped. The World Bank and Habitat for Humanity were all involved.  We did his from 1997 to December of last year.  Everything was done as philanthropy.

Five years ago I said, we have made possible the largest self built housing development in the world.  Now, how can we do Chiapas again?

We tried to put together a model to explain what we had done. We actually did not know how it happened. The angels helped us for sure.

(Picture below of the new home that the people help build.)


We tried to help the poorer people and found that our models would work for ten or so houses but then something went wrong.  But we could not make it happen for larger numbers of homes.

I tried to figure out the model in my free time but realistically I had no time to attend to it. I would go to the office, and the phone would ring and I saw it could not happen in this way.

Therefore I decided that going back to the university was the only way to work on this model and devote enough time to make it happen. I asked the dean at my university about doing a Ph.D. in this area. It would be focused on how to make a community sustainable through the self build housing market.

The Dean said let me check with the faculty. Finally, after we fought a little he said OK, you can start. And then it took me five years to put together all these areas of knowledge.

I had to learn about micro credit and apply it to housing.  I learned all this at the university and changed the PhD to sustaible housing microfinance.  Then we worked with NGOs. They said you can work in these areas.  This work resulted in the award that president Caldron gave me this past Sunday.

The angels are still around here. The phone rings and the national commission of housing wants me to do this and that. They have heard about our work and want us to go here and there. So now all the parts are coming together.

A government trust would say, “We have the funds for 5,000 houses, start building.  We have head about your program and we are deeply interested in this.”

 It is fantastic. In a way it’s like a miracle.

AMS – You observed and saw this happen and knew that you had to put all the details out clearly. And that took you five years to get your PhD.  You have still stuck with your original thesis.  The people have to work and participate and everyone gets to profit.

FP- Yes it’s a win-win situation. We say that the families and community must work together with the other partners.  All those involved must profit from the arrangement so it can be a win-win situation.

AMS-I will go back to you family situation and consider how your family leaving Italy and immigrating to another country might also have also impressed on you how families need to work together to make difficult things possible.

FP – I am thinking about what you are saying.   My father was the only son and was about to inherit not a large fortune, but he was to inherit everything and be well off.

Something that you said is picking on my mind now.

My uncles and his friends said “Mario, why go to the university as you are going to inherit a fortune and you do not have to work.

My dad said, “I like engineering and building roads.”  So he went to the University of Piazza.

Then the war came along and he lost everything. He said he came to this country with $7.00 and a suit.  This was not exactly true. They had something left after the war.

My mother was a widow of the first husband.  The first husband was a marine captain. Now it was war time, and his ship was attacked.  All the marines died during this attack. That was the end, so she was alone with little Rosanna. Fortunately she met my father and they married.

Her family lived near where the Italian marble was mined. Some of her uncles had gone to Mexico to sell marble.  One of her uncles said come here. Mexico is very peaceful, and there are lots of opportunities, the people are very nice. My father said well, I have to go there.

My father had been in jail for 3 years after the war.  He had been like a regional governor. In Italy he had this position of being in charge of many regional counties. He was a public servant that they took and put in jail.   He had done nothing wrong. My mother said what are you doing?  What is the evidence?  She fought for his release during those years. My mother showed that there was nothing wrong with the work he had been doing, and secured his release. 

AMS – Your mother also fights for what is right.

FP – My father was very disappointed in his government.  This was in 1949.  My father said my government did not support me. So I will see what is going on in Mexico.  My father came here and then wrote to my mother and said, I do not know what you are going to do but I am going to stay here in Mexico.  My father was very nice and charming and a good taste for art and was a very knowledgeable guy.

AMS – Your Dad was also ready to change.  He also set his wife free.  He seemed very mature in setting people free, even his wife was free to decide.  You follow this principle you are setting people free to make up their own mind if they want to build a home or not. People are free to choose.

FP – Yes, as you can see my mother was a very tough woman. To my father money was something; it was like a glass of wine. My mother was careful; she took care of every cent.

AMS- They were opposites that were attracted.

FP – My father worked for the state building roads in Tabasco.  It was a jungle.  My father said I saw some equipment in Italy that produced block and so he ordered this equipment. He could see it was a good business and so he began the family business and my mother took care of the money.

I can see there is a link between the generations. I can see that money is a link. It is not the reason I am here for money. But money deserves respect.

AMS- You were going to circle back to Carlos Slim?

FP- One day my friend told me, you are going to be seated next to Don Lorenzo. He will ask, tell me a bit about who you are and what you do.

So I made a special block for the occasion.  Talking about equipment would not be anything.  After all he makes equipment to make bread all around the world. So when he asked me what do I do I said I make equipment to make block and I showed him a block that has BIMBO on it.  I told him about the project.  This was before I had the PhD. I said I need the money for this project for the people.  Then he said he would help with all but the money.  He gave me the contacts, the networking to produce the housing for the poor.

Then Don Lorenzo called one day. It was shocking.  Especially to my brother who thought I was teasing.  But we talked about the project.  What is the issue here, he asked?  Financing, I said.  He said you can not hold out your hand saying give me, give me forever. No, you need sustainable financing.  Let me think about it.  He called later to say “Come to Carlos Slim’s house.” 

When I came he said, Hello Francisco, how is the sustainable market?  Don Lornezo told me about your project. What kind of market are we talking about?  I said, well, we are talking 5 million families, 25 million people, and $5,000 for each house to be built so we are talking about 30 billion dollars.   In how many years do you want to do this? He asked me.  In ten years, I replied. “No”, he said, “you need to do it in 5 years.”  So he said to my student Tony, ”Put together the company that can do this work with cement, and all the other things necessary and let’s see what you can work out.” 

We got together in a second meeting. I said, we are going to the community and motivate them to get out of the cardboard house and they have to do things. It will not be all us doing it.

Two days later Don Lorenzo called me.    I said, first we need the will of the people, and then we can get the money.  Then I went back to Don Lorenzo and he said to me.  Ten thousand here is fantastic but it’s not going to work unless you can build millions of houses. How are you going to solve the problem in Mexico, not in just one community?

Building millions of houses requires 40 billion dollars.It’s just too much money.  The government will say we have so many other problems. People are living in the cardboard houses and so I can do nothing more for them.  So I saw that all the players had to be motivated to change and work together.

AMS – It did not come as a vision to you in one moment, it was part of a dialogue with others. Do you have a drawing of your model?

I am going to go back to your mother and father for a moment.  The drawing puts the details of the plan together in a picture that is easy to understand.  I would say the logical left brain is a bit like the logic of doing the tasks like your Mom did.  You’re Dad

might have been good at the big picture, the right brain side. He was more of a big picture person and your Mom provided more of the logical details needed in planning.

FP- You always have to figure out how to bring the actors together.

The people need solutions: they need the bankers, the technology to make a better world, but they need money.  Bankers need clients.  The NGOs need the community. They work with the government and the people. Everyone has to have a reason to work together. All of them need the other partners. Then the structure can work for everyone.

AMS – A family will produce emergent leaders.  In this community perhaps you see the most viable leaders emerge?

FP – Yes, we see that this happens. We do not have to fight to see who arises.  Someone says, we have to talk.

AMS – In a big group often you can see that 10 % will lead, 70% will go along and 20% oppose.

FP- I think more oppose.

AMS – How do you deal with the resistance?

FP – If you do not want to come along, do not worry.  We switched the tone. If you do not want to work there is not a problem.  We will only be here for those who want to work.  We only need one.  

Most of the time the leader was a woman, as the female sees the house as a place where the children will be raised. The male thinks only about how much the house will cost. The female says this is my home, I will work for it.

The leader of the first community said,  “My home, not my house, is worth gold”.

AMS – What I hear in your values is that this is each person’s free decision to make.  If you do not want to do it that is OK.  But to give the people freedom to choose and take responsibility is a key.  This is a key to unlock incredible resources.

FP – Yes, even my family was wondering if this was good thing. They thought I was wasting my time.  Even my PhD was a waste, as I could be doing more work for the company.

AMS – Also your story fits into the framework for the Mindful Compass: See what needs to be done to deal with resistance, using your knowledge, and be willing to stand alone.

FP – I knew I needed to get my PhD in micro economics.  I phoned my university where I had been teaching social responsibility and began to work on developing this model.  I have had 25 years of teaching social responsibilities. I want to promote great minds that are willing to do something.

Draft of the model: It is a six sided model with feedback loops between all parties.

Communities ————————————–Government


NGOs————————————————Financial system




AMS – What are your favorite books?

FP – My favorite books are history. I love the book about Anita Roddick, the head of The Body Shop. Anita died last Sept. (23 October 194210 September 2007)  She was willing to help the people and pay fairly for their work.

I admire people who do something for the community and for society.   Some students say “Well we are not lerning about Robert Murdoch. That is because he is not doing

something worth while for society.  If you are here thinking you want to make a lot of money then you are in the wrong course.  You are here to learn how to learn and learn to be a better person.  Then you can make more money.

AMS – How long have you been teaching?

FP- I have been teaching for 25 years. I started with one math teacher who said, you can teach. He made me his assistant, then he died. He was 70 something. But he died in the middle of the course.  So the university told me you need to finish the course.  The first time I tought I was timid. But after that I said if I could live by teaching I would,

but you can not live by teaching.

AMS – You have such chrisma and enthusiasm, what a fabulous teacher you are.

I hope your class can be seen instead of the soap operas. You are far better than the actors on the soaps. It would be great fun if you were available for people on the web. It would be much more inspiring.

FP- I love Mother Theresa but there is something missing there.  There are many rich men and who cares.  Its good to find people that you admire to learn from.

AMS -How about your family.

FP – I have been married for 35 years. I have three daughters.

One girl, Alexandra, is going to finsh architecture school.  I named Rafelia in memory of my brother.  She has all the family mentally kidnapped.  She thinks a lot and comes up with something incredible to say to the family.  Franchesca, the little one, is the happiness of the house.

Victoria, my wife, is a very religious person.  She finds Don Lorenzo at church every morning. She says he sends you his regards and wonders where you were.

There is another thing I am not sure how to make sense of.   I was kidnapped.

I was beaten terribly. I was left with a lot of pain and had to see many doctors.

The first question was why this terrible thing happened to me. But then after time I understood it was not wise to ask this question.

The Dr said “Try not to do sports because of your back. Have a very relaxed

Life”. Then I said “So then do I commit suicide?”  I started to work on myself.

I lerned to ski with the family again, not every year but a bit at a time.  And I did it.

AMS- You said this also about your family of origin.  There was also not a reason for those tragedies.  Your mother’s first husband died, your br’other died.

If you see life as a process then something else will arise. We are not frozen in the past.

By naming your daughter after your brother you signal that this is not a tragedy.

Your brothers life energy will go on.  He will continue to be an inspiration in the family.

FP – I am glad you put this in as it makes our life more human.

AMS – We all have challenges and if we can overcome them and still be as charming as you are, it is an inspiration to others.

Thank you-

Mindful Compass Points


(1)  The ability to define a vision:   Clearly Francesco Piazzesi has a deep commitment to enabling others to do well. He has also thought a great deal about  where this urge to be useful to others comes from. Obviously not a majority of people are as inspired to make a difference as he is.  I always had a bug inside to help the people in the community. Perhaps this is due to my romanticism or perhaps because life has brought me a lot of opportunities.”   Over the years he found ways to contribute, yet his biggest contribution took the longest to bring to life.  Initially he was in the right place at the right time with more of an unstructured idea than with a detailed plan. It took him five years of effort to get his PhD and see the plan brought fully to life. The details of any vision are often the sticking point, and the difference between great success and failure.  In making his vision a reality he had to answer the following questions:

(1) What are the rewards for going in this or that direction? 

(2) Who will oppose me, and for what reasons?

(3) Where can I build alliances? 

(4) What are the incentives to each participant for making these changes?

Much of accomplishing his vision required that he be in dialogue with others and be able to navigate the social relationship system with comfort.   I suggested that due to his being a youngest he would have greater self assurance, all things being equal, than other sibling positions. I also suggested that due to the tragedies in his family of origin he had a stronger instinct to be helpful to others who were less fortunate.

Francesco Piazzesi is a rare individual who could see a need and be able to understand how to motivate others to build a system which can operate in different areas of the world.  The system he developed provided not only housing, but opportunity for incredible changes in the fabric of the social system itself.


(2) The resistance to change in self and in any system:  All systems will resist change. It is not personal.  It is part of the adaptive response to the new.  Francesco Piazzesi describes beautifully the back and forth with his family over his business ideas and his returning to school to get his PhD. We can see that even if it was difficult for him to manage the criticism he could sense that the others wanted his energy more for the family business than as a criticism of him.   Again in conversations with the top business leaders he was able to hear their preferences, as one way to go and then sort out what path would be the most useful. He seems to have had little negative reactivity to the opinions of others. His sense of humor is always communicated in these meetings and reduces the tension.

Early on when his brother died he asked the why question for which there is no real answer.  And then again after being kidnapped he starts to ask this question and realizes that will take him down a useless road and comes to put his energy into moving forward with his physical rehabilitation rather than lingering over the past whys.




(3)The ability to connect and use systems knowledge: Francesco Piazzesi has an automatic, internal guidance system, or compass, which enabled him to know what to do in social situations.  His basic intuition and instinct, based on his experiences, also incorporates his analytical thinking.  Therefore he considers the ideas about the link between his family dynamics and his interest in social responsibilities. We can watch as he puts these pieces together in a meaningful linked map about how family values arise.

In this way he is building his more Mindful Compass.



(4)The ability to be separate: In listening to his story I could sense his ability to separate out while listening to others’ ideas.  Because he is very adept at being social and describes his interactions well with others it may take a moment to see how adroitly he allows others to be free, leaving himself alone to await their decision. The story of how his father did this with his mother is a key insight into this process of setting the others free and at the same time making them responsible for their decisions.  It takes time for anyone to organize their life stories into more meaning-filled connections but in this interview I could see it happening in real time. At another level when he was kidnapped there would have to have a deeply courageous ability to be totally alone to come out without bitterness from a tormenting situation.

Both of these events are testimony to the need to strengthen our ability to be alone to both think for ourselves and manage the encounters with others without letting the others determine who we are.

In addition Francesco Piazzesi has investigated knowledge from other disciplines and read widely. During his life he has picked out people to learn from. Obviously being in the area of social responsibility has involved being alone to consider the deep emotional nature of problems.


Today, complex problems threatening our environment may be the biggest stress-makers we humans face. There is no consensus about who must do what, and who will bear the costs of so doing. When there are no simple answers, the group gets anxious, and it becomes more crucial to find leaders who can stand alone and enable people to come together to solve problems by taking needed action for our long term survival.



Pauline made landfall on the Oaxacan coast at Puerto Angel on 10/8/97. This was a category 4 hurricane with winds at 180 mph. Damage was extensive including downed power lines, trees, washed out roads, broken windows, roofs, mudslides and water damage. In Huatulco there was some beach erosion, downed trees and broken windows. Roofs were removed from most homes in Puerto Angel and many windows broken. Zipolite was wiped out. [photos] This included Piña Palmera and the homes of all of its employees. There has been a great deal of support and plans are underway to rebuild the center. http://www.tomzap.com/stormdam.html


The death count officially stands at 195, but church officials in Guerrero said that if unidentified bodies and those missing since the disaster struck are added, the number of dead would reach 500. The Red Cross reports that as of October 16, 2100 persons in the two states are still unaccounted for. Most are presumed dead.

About 400,000 have been left homeless in Oaxaca and Guerrero, and a third of Acapulco’s million inhabitants have been affected, most having been left without electricity or water. Tens of thousands who depended on tourism to earn a living are without work. Like all natural calamities, Paulina and its aftermath have highlighted social and material inequalities and magnified existing political flashpoints. http://www.greenleft.org.au/1997/295/15667

The company, headquartered in Littlehampton, West Sussex, England, was founded by Anita Roddick and is known for its vegetable-based products ranging from Body Butter, Peppermint Foot Lotion, and Hemp. The Body Shop has emphasized its support for a wide range of issues around the globe. Its slogans included: Against Animal Testing, Support Community Trade, Activate Self Esteem, Defend Human Rights, and Protect Our Planet.[1] Roddick was awarded the 1991 World Vision Award for Development Initiative Award.[10] In 1993


  1. Burning question: Has micro credit done a lot?
    found a good article and book on micro credit and grameen
    bank: http://microcredit-book.blogspot.com/
    Contributors of this book are Doug Henwood, Patrick Bond, Bosse Kramsjo, Badruddin Umar, Susan F. Feiner and Durcilla K. Barker, Farooque Chowdhury, Robert Pollin, Gina Neff , Anu Mohammad, Omar Tareq Chowdhury.

    Here of the excellent article of this book:

    The metamorphosis of micro-credit debtor
    Farooque Chowdhury

    Micro-credit, the well-propagated mantra in the fight against poverty, is now expanding crossing the national boundaries as capital has done for centuries. Countries in the centre and in the periphery in the present world system are near-spellbound by this mantra. The actors include kings, queens, statesmen, bankers, charity foundation initiators, economists, development workers and the poor. Only the last one is at the receiving end.
    The metamorphosis of the micro credit debtor exposes the acts the capital plays in the act of micro credit and makes all its pious pronouncements hollow. The metamorphosis takes not only to the debtor, but also to other members of the debtor-household.
    The debtor of the micro credit turns owner of the tools or raw materials necessary for producing commodity as the debtor returns home from market after purchasing these with the credit money. But with the joy of ownership a poor debtor enjoys through this metamorphosis there comes a new burden, the burden an industrial proletariat does not have to bear: the burden and responsibility of maintaining, repairing and replacing the tools, equipments or parts of these and the costs that accompany it as the debtor is going to produce and going to be a producer of commodities. It is an extra burden. Usually the job is done not only by the debtor, but also by the other members of the debtor—household. That means time, necessary or surplus labour, depending upon a situation. The proud ownership carries another intricate calculation. An industry owner provides premise, shade, light, water, storage facilities, transport, etc. for producing a commodity and before hiring a wage slave the owner has to spend money for these ranging from construction, power and water connections, supervision, etc. which are calculated before the surplus value is appropriated. But in case of the micro credit debtor turned independent owner of tools of production all these burdens fall upon the debtor. It is the responsibility of the debtor turned owner to repair/replace/heal and to spend money for these. That means the debtor has to arrange the constant capital, and sometimes, the variable capital. The creditor does not always provide the money required for these purposes or the debtor has to set aside a portion of the credit money for these purposes. If the debtor sets aside a portion then the person has to extend extra time to the portion of labour that produces surplus. Moreover, the debtor turned owner has to construct/raise a shed for carrying on the production activity and spend money and labour power belonging to the debtor and the debtor’s household. Actually, the debtor, most of the time, uses own premise, rent for which is paid by the owner of the production unit, the debtor. Maintenance and repair is paid by the debtor, now turned into an independent producer. An industrialist has to pay rent for the premise, utilities and other facilities while they are within the premises producing commodity. But in case of the micro-credit all these are the debtor’s responsibility. The metamorphosis of the debtor to owner of tools, etc., to independent producer thus does nothing but increase the surplus labour time and squeeze necessary labour time so that the repayment of the loan can be made as per schedule.
    The debtor turned producer has to plan, search and work out comparative advantage, and procure and transport required raw materials for the commodity to be produced. The debtor, now acting as procurement manager of the household-based production unit, procures and carries or transports the raw materials for the commodity to be produced. Sometimes it is the spouse or sibling who performs the task, unpaid and unaccounted labour power put into the process. Is the equation in favour of the fellow who went to the banker for the poor to realise the fundamental right the banker propagates? Reality is that the shortened necessary labour time and the lengthened surplus labour time, obviously provide the answer. What about the level of appropriation? It is, certainly, not at the level Marx ‘calculated’. It is super-appropriation, never imagined by the mine owners of Rome, the colonial plunderers, the plantation owners, the slave owners in pre-slavery America, the multi-nationals operating in the countries on the periphery, not even the plundering-lumpen capitalists in a number of underdeveloped countries, but only by the multi-national micro credit capital. So, Michael Lipton and John Toye said in ‘Does Aid Work in India?’ : Rates of return on credit projects are particularly high in India; and Joe Remenyi said in ‘Where Credit is Due: Income Generating Programmes for the Poor in Developing Countries’: Credit – based income generating projects may be the most profitable way in which society can invest…Diminishing return has not set in this field…;…banking on and with the poor is a very good thing to do…. The typical successful CIGP …required an investment well below $1,000 per sustained wage – paying position created (one – tenth of the ratio in the formal sector)…[W]hen one is living at the margin of survival earning around $1 a day, an increase in earning capacity of 50 cents a day represents a substantial improvement in cash flow. These statements tell the truth.
    The metamorphosis of the debtor moves further as the fellow turns wage labourer. The micro credit finds a new commodity as, borrowing from Engels, the ‘source of new value,’ source of surplus ‘income’ with which the debtor will repay and ‘this commodity is labour-power’. The labour power is stored up in the bodies of the micro credit debtors and other members of the debtor-household who extend respective labour power to extend the surplus labour time so that the repayment could be made on schedule. As an independent producer the debtor has to fix the pace of production and that determines the debtor turned wage labourer’s pace and length of working hour. Even, the debtor wage labourer has to borrow labour power of others in the household, who are actually paid only by bare subsistence. To make the statement complete it is not the debtor only, but other members in the debt ridden household, along with the debtor, also, turn wage labourer, at least, part time. Does it not appear more intense than the conveyor belt or the Taylor system innovated by the industrialists to increase surplus value? Thus, the entire household turns into a household of wage labourers, full time or part time. Actually, the pace of work is determined by the time schedule of the repayment. Within the scheduled time for repayment the independent producer turned wage labourer, along with the co-workers in the household have to produce and sell that quantity or that number of commodity that can bring in at least the amount of money needed to repay the instalment of the debt. If seasonal variations, changes in market, health problems, other unseen troubles, non-availability of raw materials or transport, in short, major and minor forces, i.e. ‘acts of god and acts of reality’, coordination with the marketing day and the instalment day are taken into account then the pace of production of a debtor turned independent producer turned wage labourer can be imagined. The person has to forget 8-hour working day, rest, amusement and attending to family chores. It is only to produce surplus enough for repayment. Does it sound like the sweating system? Does an industrialist having a supervisor or a foreman appear fool? While an industrialist has to devise a mechanism, a supervisory system and keep a physical appearance in the work place the micro credit capital does not require all these. Its mere regimentation, mere providing credit at the doorsteps of the poor and its higher level of ‘consideration’ or attention regarding collection of part of the credit from the debtor’s home so that the poor fellow does not turn a defaulter that determine the pace of production. This is the condition of the micro credit wage labourer, obviously a bit different from an industrial wage labourer. An industrialist ‘purchases the use of one week’s labour of [a] worker’ if the worker is paid on weekly basis, but the micro creditor purchases the labour of the debtor for an entire year, if, assumed that the loan will be repaid within a year, or for the entire period until the loan is repaid. With the payment for necessary labour time, a specific amount of money paid for subsistence of a worker and members of the worker’s family, an industrialist ‘ensures the continuance of labour-power even after his [the worker’s] death’, but the micro-creditor ensures the simultaneous use of labour – power of the household members of the debtor along with that of the debtor. The labour, through persistent struggles, has won, in relative terms, a number of measures to safeguard own body and soul and the capital has to compromise for its own sake. But the micro credit debtor turned wage worker toils without coverage of any such measure. The micro credit capital that finances micro-production units at household level is smart enough to escape, till today, the struggle of the debtor turned wage worker, by pass all rules, even norms attained so far, and stay safe. There is no working hour; no weekly holiday; no law, rule, regulation governing working time, working condition, safety measures, child labour, female working hour, etc.; no inspectorate looking at the working condition. This makes life miserable for the micro credit debtor turned wage worker and for the members of the household including the minors who help create surplus value without any legal coverage.
    Now, only a few numbers quoted from Microfinance Statistics (vol.17, Dec., 2004), a publication of the Credit and Development Forum. These will help comprehend, at least partially, the width and length of the micro credit net and the surplus value it appropriates in a single country. In Bangladesh, in 2004, the number of active members in the 721 micro financing organisations (MFO), reporting to the CDF, was 16,622,047 and in 2000, it was 11,021,663 in 585 MFOs. In 2004 the number cumulative borrowers from 721 MFOs was 16,244,242 in a country of 140 million. It was 7,409,773 from 585 MFOs in 2000. There are many other MFOs that have not reported to the CDF, many others are operating in different guises and many other programmes and projects operating not as MFOs but carrying on micro credit business. From how many souls do a group of industrialists in a poor country appropriate surplus value? Are those always more than the number just cited? There are answers, obviously, to this question. It is expected that a reader will search the answers.
    The metamorphosis of the micro-credit debtor continues further as the person moves to market with the commodity produced. The debtor then turns to an independent trader competing with peer debtors turned independent traders in the market place and at the same time they together fall prey to the vagaries of market governed by the mighty market forces. While carrying the commodity to the market, sometimes, some other members of the household, shares the load. This labour is unpaid in terms of wage. If counted or paid, the amount comes from the surplus value already generated. If it is unpaid then the amount thus saved stays within the surplus value to be paid to the creditor waiting for the next instalment of repayment. As an independent trader the debtor turned independent producer turned wage worker has to bear all the responsibilities of a trader. But an industrial labourer does not have to take all these responsibilities. The wage slave in a factory just completes respective job and gets compelled to be appropriated of the surplus labour time. Market, supply, demand, transportation of commodity to market, storage, taxes and tolls, speculation, price, etc. are not part of a factory worker’s business. But as an independent trader the micro credit debtor has to bear these extra burdens which are not the creditor’s concern at all. The creditor has tactfully, through the modus operandi, has put it upon the poor debtor’s weak shoulder. There are commodities in the market that are produced in larger, mechanised production units, with higher productivity, which means a cheaper commodity, and, commodities that enjoy facilities created by the WTO. This situation puts the debtor into an unfavourable, uneven playing field, cuts down the debtor’s competitive edge and presses down price of the commodity produced in the household by semi-skilled and unskilled workers and produced with artisan method and tools. There is the packaging, marketing and advertising factor. The person has to reconcile with the situation and that means further tightening of belt. The micro-credit thus pushes the debtor to such a situation with extra burdens while it demands regular repayment of the credit.
    The data on the sectors or sub-sectors that use micro credit in Bangladesh show the sources of surplus value appropriated and who ‘offered’ the surplus labour to generate the surplus value. In 2004, according to the data published in the above mentioned CDF publication, of the 379 MFOs reporting to the CDF, 27.94 percent of cumulative disbursement was in the agricultural sector that included crops, livestock and fisheries sub-sectors while only petty trading sub-sector covered 40.61 percent. The percentage of food processing and cottage industries was 6.28 and of transport it was 2.20. In the years 2003, 2002, 2001 and 2000 the petty trading dominated. From where does trading, whatever its size is, produce the profit? A portion of it is surplus value generated by others in other places. What about the transport, the rickshaw van or the boat, and the cow fattening? The same answer. It is also the surplus value generated by and in different segments of the broader society that is appropriated by micro credit capital that gets in through the debtor’s hand. Other sectors and sub-sectors also provide similar explanation found in political economy. The above mentioned CDF publication provides a few more startling facts: ‘utilisation of loan by sector or sub-sector (as percentage of cumulative disbursement)’ in ‘social sectors’ in 2004 was 1.70 (health:0.44, education: 0.06 and housing:1.20); in 2003 it was 1.58 (0.45 for health, 0.04 for education and 1.09 for housing); in 2002 it was 1.41 (0.39, 0.05 and 0.97); in 2001 it was 1.76 (0.42, 0.11 and 1.23); and in 2000 it was 1.69 (0.37, 0.02 and 1.3). The ‘social sector’ meant by the cited publication was health, education and housing which are actually required for ensuring the debtor’s and the debtor household’s survival, keeping the body and soul of the household based producers or of the trader or of the transport operator together, ensuring that production or trading could be carried on or transport could be operated so that surplus value generation or taking share of surplus value generated by some other is ensured, so that the repayment that includes surplus value is ensured. If a debtor does not have a house or a shed the production unit will be inoperative or will face problems in the production activities; the raw materials, the tools, the fuel, the cow or goat or poultry, the commodity produced could not be stored in; the producer and others in the household joining in the production activities could not survive. So, the housing sub-sector was emphasized most while lending out money in the CDF defined ‘social sectors’. Of course, the façade was benevolence by the micro creditor. Then came health with the same arguments. A judicious choice of the appropriator! Material interest tops the list over human consideration. The extent of concern for health of debtor and debtor household is directly related and tied to the extent of concern of continuation of production, etc. activities. It was followed by education. The level of production and the level of transaction determine the extent of education required and the level of emphasis put into education. None can override this rule. The micro-creditor, also, faithfully follows this one and the life of debtor goes through this metamorphosis.
    Thus, the circuit of metamorphosis of micro-credit debtor moves on and ultimately it completes a full path: a poor, an appropriated person turns debtor, the debtor turns owner of tools of production., the owner turns household based independent producer, the independent producer turns wage worker, the worker turns independent trader, the trader stays entrapped into debt with worsened condition and bigger debt turning one to debt slave. In its circuit the micro credit debtor only produces surplus value or takes a portion of surplus value produced by some other debtor or some other person or persons in the society producing surplus value and transfers a portion of it to micro credit capital. The circuit is both, a closed and an open, signifying the contradiction. The closed circuit keeps the debtor in perpetual and worsening poverty; sometimes, borrowing from the micro-credit literature, graduating a percentage of the borrowers, but pushing down or entrapping others in increased number; and often, throwing back the graduated debtor to the den of poverty again; and in these cases, the mainstream economics finds the rationale in ‘shocks’, ‘setbacks’, etc., natural and social, as their terminology defines. But whatever happens in the lives of a certain percentage of the debtor that does not change the basic structure of the circuit in the broader social matrix, in the process of appropriation of surplus value. Ignoring the macro scenario and putting forth the micro, a few individual cases, putting forth the exceptions instead of the general rule does nothing but vulgarises the arguments itself pushed forward by the mainstream. The open circuit intensifies and accelerates the pauperisation process and thus creating pressure on the system that creates poverty, makes a person poor, and appropriates surplus value. The vulgar economics with ‘hollow eye and wrinkled brow’ (Shakespeare, Merchant of Venice) extending support to micro credit capital may construct a façade by resorting, again, to vulgar arguments. It may argue that a certain percent of micro credit debtors have improved their living condition with the aid of the panacea as a few days ago they used to mean the micro credit. But this does not nullify the fact of appropriation of surplus value from others in the broader society. Rather, it puts the evidence that surplus value has been appropriated from some other persons. There are many economists in the bandwagon of micro credit who cite cases of increased consumption by the micro credit debtors. But it should not be missed that consumptions are of two types: productive and individual; while the first one is to create products the other is turned into means of subsistence. So, data of debtors’ increased consumption, claims regularly made by the mainstream economics, carry no meaning other than better and ensured supply of surplus labour power which is expropriated. The fact should not be missed that the entire system rests on the appropriation of surplus value and micro credit is a part and, now is an institution of the system. It is sustained by the system and it helps sustain the system.
    The socialisation of micro-credit, with its profit profile, allures other capitals in banks and financing companies to join in. The capital engaged in micro-credit ties, quoting from Shakespeare, the ‘poor man’s cottages [to] princes palaces,’ organises and regulates debtors including members of the debtor-households, keeps them entrapped in the micro credit web, appropriates surplus labour power of them and others in the broader society. Moreover, it now regulates, based on its global power, the analytical process of a section of economists who overlook the process of appropriation of surplus value upon which the micro credit thrives, and try to ignore definitions of political economy and propagate vulgar ideas.

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