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Financial Literacy as the First Global Silver Rights Empowerment Tool: 5 Things Countries Can Do

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Recently, in speeches and articles (notably Bloomberg Business Week, April 2010), I have made the case that post global economic crisis, financial literacy is the new civil rights issue in the United States, and this past week, while speaking before at the OECD (Organization of Economic Cooperation and Development) Forum in Paris, France, I spoke about financial literacy as the first global silver right empowerment tool. Quoting my personal hero and mentor, civil rights icon Ambassador Andrew Young, "to live in a system of free enterprise, and to not understand the rules of free enterprise, is the very definition of slavery."

I have said that "to not understand the language of money, financial literacy, and to not have a mainstream bank account (or credit union account) in the 21st century, clearly an economic age, is to be an economic slave." If you don't know better, you cannot do better.

And so, as OECD gathers government leaders together from its 34 member developed countries I had a special message for them on behalf of the poor, the under-served, the voiceless, and even the now struggling middle-class too.

My message, available on the OECD website, captured in an article in the OECD Observer Magazine, as well in a special OECD Blog post I subsequently wrote, boils down to us all using this crisis as a once-in-a-lifetime opportunity.

If the 20th century was about the emergence of democracy amongst free people all around the world -- from Gandhi in India to Nelson Mandela in South Africa, to Michael Collins in Ireland, and Dr. Martin Luther King, Jr., Andrew Young, John Lewis and others in the southern states of the U.S. -- then the right the vote made democracy and freedom real to the average person.

In the 21st century, in the backdrop of a global economic crisis and in an era of economics, understanding the language of money (financial literacy), accessing the mainstream financial system with dignity, avoiding financial predators and pursuing your aspirational dreams without illegitimate barriers of opportunity, is in fact the freedom we seek today. It is the freedom we have always sought. It is what Frederick Douglass who said in 1874, upon the failure of the Freedman's Bank that (paraphrasing), "the failure of the Freedman's bank did more to hurt the progress of newly freed black slaves than the impact of 10 additional years of slavery." Part of the mission of the government sponsored bank was financial education. We need this again, but now for everyone.

Fact: more individuals do not have a bank account today or are under-banked today (approximately 40 million according to the Federal Deposit Insurance Corporation), than didn't have the right to vote in 1962 (approximately 22 million).

We must first and foremost unpack the "language of money" for the masses of this world. This includes understanding financial education (basic knowledge), financial literacy (the basic ability to operate in the world of free enterprise and capitalism), financial capabilities (the U.S. Treasury Department coined phrase focused on your available options, products, tools and services), and the Operation HOPE specialty -- financial and economic empowerment (the ability to act on opportunities and aspirations in your life).

With this we must help to spark a new generation of educated, hopeful, empowered, aspirationally relevant and opportunity rich young people here and around the world -- focused on maximizing their enlightened self-interest, and advancing the interest of civilization and community in the process.

Next, as I outlined during my remarks at the OECD session, there are 5 things OECD countries can do to advance silver rights in their respective countries:

  1. Launch a campaign for mentors and role models in your country. In the bestselling book The Tipping Point by Malcolm Gladwell, research has shown that at 5% role models every community stabilizes. Not 75%, or 50%, or 25% or even 10%, but a mere 5% role models. There is reason for society to be hopeful and hope filled indeed. Most under-served communities have 3.7% role models or less. The gap we can do something to change, and in so doing, to help "make smart sexy again" in communities where dreams are challenged by short-term stark realities.
  2. Financial literacy as the new civil rights issue, and the first global silver rights empowerment tool. Require all student learners, through 12th grade, to take a mandatory course in financial literacy. Build on the leadership of Congresswoman Sheila Jackson-Lee (D-TX) where she introduced a bi-partisan bill in the House, inspired by the work of Operation HOPE, which would require every college student receiving a guaranteed student loan to also receive a mandatory course in financial literacy. The bill would also require any college or university receiving federal funds to also offer a course in financial literacy.
  3. A bank account for all. More individuals are either unbanked or under-banked in the U.S. today than didn't have the right to vote in 1962 during the civil rights movement (approximately 40 million compared to approximately 22 million). Access to a mainstream bank account is as essential in the current economic era as the right to vote was during the 20th century, around the world. Provide a basic bank (or credit union) account to every child at birth, no different than the right to vote (as a birth right), and in the U.S., no different than the issuance of a Social Security Number.
  4. Orient government policy to the creation of small business. In the U.S. and most developed countries, small businesses account for the bulk of job creation (the majority of jobs come from small businesses in their first 5 years), and every (private) big business, started as a small one.
  5. Nurture a generation of entrepreneurs and a culture of entrepreneurship. America's greatest triumphs, from Henry Ford and the automobile (industry), to Ted Turner and CNN (and 24 hour newscasts), to Bill Gates (Microsoft, Gates Foundation) and Steve Jobs (Apple), have come from the power of a simple but paradigm shifting "idea." The developed world is shedding jobs in this global re-alignment and developing countries are "young" (both with respect to industry and in most cases population demographics) and hungry for almost everything. Governments cannot continue to "fund" GDP growth nor subsidize all those with growing needs. Governments need to nurture and launch a major 10-year effort to spur a youth entrepreneurship generation, and a 20 year effort to change and mold a "can-do" culture (entertainment icon, my mentor and 5MK co-chair Quincy Jones says that "it takes 20 years to change a culture." Well, over the last 20 years we have collectively helped to "make dumb sexy." We need to "make smart sexy again.").

How do we pay for this? The innovation and creation of new emerging markets, resulting in the introduction of new sources of government tax revenue, is how.

This approach is "net gain" for all involved, and is one of the truest definitions of Love Leadership in action.

When you do what is outlined above you, over time, also create a new generation of stakeholders, contributing working class, engaged and energized citizens who vote, and who aspire to one day be middle class (key for any stable democracy). These are your future employers and the foundation of a sustainable, lasting democracy.

When you do this, you are helping to secure the lofty promise that democracy called forth in the 20th century, and in so doing you are helping to restore confidence and credibility in "markets," by making free enterprise and capitalism work for the least of God's children.

If we want to honor the legacy of the late, great Dr. Martin Luther King, Jr., then honor his last great, unfinished work with his "Poor People's Campaign." Dr. King once said, "you cannot legislate goodness or force someone to respect you. The only way to social justice, in a capitalist country, is economic parity."

This is what I mean by silver rights.

John Hope Bryant is an entrepreneur, the founder, chairman and CEO of Operation HOPE, former vice chairman, U.S. President's Advisory Council on Financial Literacy, financial literacy advisor to the World Economic Forum Global Agenda Council, a Young Global Leaders for the World Economic Forum, internationally recognized public speaker and author of LOVE LEADERSHIP; A New Way to Lead in a Fear-Based World (Jossey-Bass), which debuted in August, 2009, as the Amazon.com #1 Hottest New Book (for Leadership), on the CEO Reads Top 10 Business Best Seller List, and was published in November, 2009 in digital audio book format on Audible.com, iTunes and other audio book retailers . Love Leadership was listed amongst the Top 25 Business Books for Inc. Magazine/CEO Read for the first 8 month period after release.

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