Heath Insurance

I am currently battling the health insurance companies. It is a hard fight and here is the back story: This past summer, I had the fun experience of having a pneumothorax or spontaneous lung collapse. It was actually my second one (lets hope that third is not the charm). I don’t view the ailment as very serious. All it means is a four-day vacation at the hospital—doped up on western medicine’s finest medley of painkillers. I return home for a week of excruciatingly painful bed rest and in a month’s time, I am more or less in decent form.

I have health insurance--thank god for Massachusetts and its progressive health insurance legislation. However, the real inconvenience is not the missing essential organ; it is the mountain of paperwork and arm wrangling by the health insurance companies that drives me to insanity. At first, the insurance company flatly refused to cover any of my $25k medical bills. Then, realizing that they have a responsibility to cover people who pay premiums, they fight tooth and nail to pay as little as possible.

How did health insurance get to this point? How did the US medical system become one where the patient feels victimized? Although I complain, I know that the health insurance/medical system in developing countries is 10x worse. I remember one situation where government doctors in India routinely took exorbitant bribes from the poorest of the poor for routine medical procedures.

Health remains one of the key challenges when overcoming poverty for those living at the bottom of the pyramid and those living in the US. This begs the question, how are US development consultants qualified to advise developing countries about health policy? If we can’t figure it out for ourselves, what gives us the authority to push a broken system?

4-Hour Workweek

I recently started reading a book by the title of The 4-Hour Workweek. It is definitely one those self-help/become rich quick guides, which I enthusiastically devoured back in the college years. It has the smooth undertones of a Rich Dad, Poor Dad and the earthy hues of a E-Myth Revisited. I just began reading it, so it would be unfair for me to begin making any definitive assertions, but it did get me thinking. How would it be possible for anyone to work a 4-hour workweek for a non-profit or microfinance institution?

It was standard procedure for a person to put in at least a 12-hour day. The worst part is that people working in development are often paid much less that peers working at equivalent skill levels but in higher paid industries. I don’t think the 4-hour work week would cut it in the developing world. What if you were inoculating children against hepatitis? What would you say to them? ‘Sorry, my 4-hours are up…I will see you next week’.

There are some types of work, which requires people to devote themselves to the cause. These are the people who work in the remote regions of the world, who are paid at poverty level rates, who do not even have the luxury of indoor plumbing and who work 12+ hours. However, it is interesting to find that many of these people are satisfied with their lives. They have a mission—a worthwhile goal—that sustains them through the physical harsh realities.

Then there are those living in the western world. The people who have all the physical amenities—the car, nice apartment, 9-5 routines. However, these people seem to have an emptiness. They lack purpose, meaning and motive. They work to sustain their physical comfort.

What I came to realize is that when working in development, it is necessary to balance these two worlds. I realized that I am not able do the extreme all or nothing development experience. Furthermore, I would go insane if I worked the mindless 9-5 grind. There needs to be a combination of both experiences. I want a comfortable home and to be compensated appropriately, but I also want to be helping people and making lasting impact. Of course, finding where these two worlds meet is the real challenge.

Hemlocks and Beetles

A little aside from the usual discussion of development, but I have been thinking quite a bit about a Ted talk. Richard Preston talks about the Redwoods of the pacific northwest. I have always held a fascination with those behemoth wooden monsters, and on a recent visit to the west coast, I even had the privilege of seeing some of them. What stood out for me about the talk was a piece about the East Coast Hemlock trees, which are a distant relative of the Redwood. Currently, the East Coast Hemlock's are being threatened with extinction by an invasive beetle. In some areas, the beetle has destroyed 90% of the population of Hemlocks.

What struck me as interesting was an earlier part of the Preston's talk, where he discussed how only 4% of the Redwood population still remains from just 50 years ago. Intensive logging and human contact have destroyed the majority of Redwood forests. Now, I was just thinking, if I was a beetle, reading this information for the first time, wouldn't I think that humans were the more invasive species?

What is worse is that humans have the ability to make a choice. We can decide whether or not to destroy or save a species. For the hemlock situation, we view the beetle as invasive and the hemlock as the victim. We feel obligated to help the hemlock, to rescue it from the threat of extinction. However, what if in the process of saving the hemlock population, we bring the threat of extinction to the beetle population. The situation is further complicated because most likely, humans were the ones who inadvertently introduced the beetle population into the eco-system!

In a sense, the battle between beetles and hemlocks is very similar to development work. In any given country, there are the powerful and powerless--the poor and the rich. Cultures around the world are threatened and face extinction. For example, the culture and knowledge of Ayurvedic medicine has faced near extinction at the hands of western medicine. Tibetan culture faces extinction at the hands of Han Chinese. When is it our role to choose who wins and who loses in these battles? Are there any real 'winners' or 'losers'?

Recession

The recession is upon us. It is about time. I remember when the recession first started a year ago. At the time, I clearly remember my conversations with investment managers, mutual fund representatives and insurance people. They were all telling me that now was the right time to buy! They were so passionate and sure of themselves. They believed that the bull market would last forever and all I would have to do is give them all my money and all my troubles would be solved. I remember thinking that a year from now, the economy was going to be destroyed, but still they were adamant. It is good for me that I ignored their pleas.

Now we have the long struggle ahead of us. There will be no quick rebound. All we can do is wait and see. The virus of recession is already spreading around the world. Soon even China will be bailing out major industries as demand slows. Growth will slow and even contract. It is not a good situation but it is the only thing that can balance out the excess which we have had over the past few years. We have lived in a fanciful world where credit was free and easy. Now we need to pay back the world. For me, I am glad for the downturn. I have always believed that the world’s assets have been overpriced. Now, I will actually be able to afford investments such as a house or stocks.

Lost friends in Mumbai

I was devastated to learn that two of the casualties of the Mumbai terrorist attacks were two friends. Rabbi Gavriel Holtzberg and his wife Rivka were welcoming hosts when I lived in India. Whether it were for the high holiday services or shabbat dinners, their doors were always open. On their top floor flat, relaxing after a long shabbat meal with new friends, we would have discussions about living abroad, Judaism and Indian culture. Reflecting together, looking out over Bombay harbor on a balmy night, who would ever imagine that assault teams would repel from helicopters onto the very same site where we casually sat? Who could imagine that the Holtzbergs would be taken hostage and murdered?

I can still remember the taste of fresh watermelon that we had after breaking fast on Yom Kippur. I even remember where I was sitting and what Rabbi Holtzberg had said after we had ate. Those small moments are captured forever and even though Rabbi and his wife have passed on, they are not gone. They are with me, and the way they treated me and shared with me will never be forgotten.

Terrorism has never touched me quite in this way. Although I was in NY when the September 11th attacks occurred, I did not personally know anyone murdered. This time, friends were killed, and for that, I am forever changed. One of the things that I know is true is that I can not letting terrorism control my life. I look forward to the day that I return to Mumbai, that dirty, smelly, chaotic wonderful city. I can not wait to visit VT station and get cramped into one of the packed trains. I look forward to hanging out in the air conditioned lobby of the Oberoi, and I will relish with pleasure going dancing at the night club in the Taj Mahal Hotel.

Mumbai attacks

Tonight my thoughts and prayers are with the Indian people. Having lived in Mumbai for a period of time, today's attacks strike at a second home. The main targets were hotels, restaurants and train stations that I had frequently visited. The image on the NYtimes of the Taj Hotel burning, especially hurt and was hard to believe.

I was shocked to read on the same link above that violence was even occurring at the Chabad House down the street from the Taj Hotel. The same house where I spent shabbats and high holidays was under siege. It is horrifying to think that friends and family members of friends could be stuck in one of those buildings as a hostages. Even more disturbing were reports that the attackers were singling out US and UK citizens. If I were still living in Mumbai, there would be a good chance that I would be stuck in one of those hotels or restaurants.

I was listening to a MSN webcast earlier which pointed out that these attacks were very similar in style to the 9-11 attacks. This is certainly true when you consider the historical background of the Taj Hotel and Chhatrapati rail station. All these locations were Mumbai's best known landmarks. Furthermore, Mumbai is the economic engine of India; it is the country's heart and melting pot. It's like NYC and LA wrapped into one. It hurts me today to see a city that welcomed and accepted me be mangled by violence.

Echoing Green and Desalination

The past few days, I have been working on a application for Echoing Green--a social entrepreneurship contest that awards up to USD 90k to winning fellows. The idea I have been working on was conceived by my friend Adam Stein, whose company Advantageous Systems, is in the process of producing medical devices that utilize nanotechnology.

Adam's idea utilizes a nanotechology to desalinate water. It is a very clever process that has great potential for being utilized in the developing world. The hardest part of the application has been crafting the correct message. The fellowship is quite demanding in regards to being very specific on what social issues your idea is seeking to help. Thus I have been putting a great deal of thought into what exactly is the core issue and why desalination helps in solving this issue.

Pirates!!!

Pirate attacks off the coast of Somalia!!! Its strange to think that pirate attacks still occur today--they seemed like a passing trend, something that should have been squashed by the British empire. But nonetheless, they persist to this day. Today in the NYtimes, I came upon a tale of battle at sea between the Indian navy and the pirates. The Indian navy was able to sink the so called mother ship; however, the pirates escaped in high speed race boats.

I get all of my pirate related news from the Singapore Business Times, which surprisingly provides detailed coverage of different pirate related topics. The headlines today included:

Pirates seize 7 ships in 12 days, latest from Iran

Piracy driving ships to take Cape route, avoid Suez

Indian warship scores one against pirates

Are we very surprised that pirate attacks are occurring? Somalia is a failed state with no government, no order and a crumbling society. If you had a chance to escape all this chaos, wouldn't you become a pirate. If there was one thing we learned from Afghanistan is that we can not let a country become a black hole for chaos and anarchy. The more we ignore the problems in these areas, the more chance that we will see repercussions. Somalia needs humanitarian aid, it needs a function economy and political society. If the country and people can't do it for themselves, then the international community needs to step up and get the job done.

MIT Executive Summary Competition

Last night, I stopped by MIT to see who was participating in the school's executive summary competition (ESC). The ESC runs in line with the notable 100k business plan competition. The event was a mixer for all those applying for the development track. It involved both people with ideas and people without. I fell into the group without and had a few interesting conversations with some of the individuals with ideas, which included a plan to set up a recycling for construction material in developing countries, a bicycle that doubled as a sheller for corn and a device which converted plant vegetation into charcoal. It was interesting to the see the process. I talked with one of the coordinators of the event who told me that 5 out of 6 winners of the business plan competition, had also participated in the executive summary competition. However, the business plan competition doesn't require you to do the ESC. As I work to develop my own idea, it is helpful to understand the whole process and it is good know that the competition is a possibility for me in the future.

One Machine and Development

A few days ago, I watched a Ted video by Kevin Kelly where he describes his vision of where the internet will be in 5,000 days. Kelly notes that technology and humanity are becoming more and more entwined--creating what he termed as "One Machine". One Machine (or OM for short) is both the next evolution of the internet and the next stage in human development. Kelly explains that through OM, everything is connected and there is freedom of exchange throughout the entire system. For example, ones thoughts and ideas are instantly shared and exchanged amongst all the participants in OM.

This got me thinking about whether people living at the bottom of the pyramid would be included in this paradigm. In a way, they are already being brought into the fold. Mobile phones are one of the most purchased items in developing countries. Although the current mobile phones in these areas (typically Nokia 1100) are not designed for internet access, how long will it be before they are? Maybe five years? Whats interesting is that the internet will give a tremendous voice to those in developing countries. In the past, if you had problems with the government or a company, and you were poor living in a rural area, you had very few options. Now all these people will be connected to one another and are capable of sharing thoughts and ideas. It would be interesting to create a Twitter like website for the BOP individuals.

Concepts like mobile banking are also examples of being part of OM. Through mobile bank, a person is now included in the global economic system. The loans payments a local entrepreneur can make are now directly connected into the electronic money system. One other thought that sticks out for me was the idea of writing and language. Both of these are tools that we human's use to interact; however, they are a poor substitute for our actual thoughts. OM has the possibility of tearing down the walls of language that prevents an American truly understanding the ideas and concepts of a African.

Kiva 2

I am happy to report that I got clarification about how Kiva works. My friend Lander reports below on how a user's contribution is allocated:

"A user's contribution does not go directly to the loan applicant. The user is actually making a 0% interest loan to a local MFI, which in turn makes a loan at its standard interest rates to the loan applicant. Since money is fungible, the MFI sometimes makes a loan with its own resources andthen allocates the loan as a "Kiva" loan once it receives Kiva funds"

Additionally, I recently met up with another international development enthusiast living here in Boston, Molly Zeff. She pointed me on to an interesting development site. The website is Kickstart which is a technology hub for BOP ventures. Their most popular item is a water pump. I remember back in college reading about a similar program sponsored by a large development agency. The program was a resounding failure mostly because if the pumps broke down, then it was very difficult to bring in replacement parts. The question is, how does kickstart solve the distribution and maintenance issues?

Mobile Banking 2

Building off my last post, I have since begun doing extensive research into the concept of mobile banking (MB). In particular, a recent policy paper from CGAP has been especially helpful. The June 2008 paper, Banking on Mobiles: Why, How, for Whom? written by Ignacio Mas and Kabir Kumar. Outlines the key concepts, challenges and opportunites that MB has to offer microfinance institutions (MFI).

The first section lays out how a hypothetical mobile banking experience would be conducted by a customer--giving interesting hierarchical diagrams of the process.

The next section examines the benefits that mobile phones could have for banking, which include mobile phones being virtual bank cards, point of sale devices, ATMs and internet terminals. Additionally, mobile phones allow banks to interact with consumers in new ways such as marketing and account information.

Another point brought up is the issue of cash. How do banking clients access cash when there is mobile banking? Possible options include third party banking agents, ATM terminals and banking branches. I wonder if customers prefer in particular any one of these access points? My guess is that clients prefer the face to face contact of loan officers.

In terms of the benefits MB to MFIs, the paper notes that MFIs can increase market penetration, sell additional services to exisiting customers, retain the most valuable customers, and reducing the cost of service provision.

Summarizing the first part, the paper concludes that a bank has three choices for possible MB scenarios: Cool value add, easy bank and a virtual bank. I think that the decision for an MFI to choose one of these scenarios depends upon the MFI's goals. Therefore any MB platform created has to be adaptable enought to fit any one of these situations.

The more I investigate the subject, some questions that keep on popping up are who are the major players currently in the field? What is the cost of implementing a MB program? What is the monetary value of MB to an MFI? Why hasn't MB gained wider acceptance? How would a MFI identify and setup a relationship with a third party banking agent?

All these and much much more as I continue my research.....

Mobile Banking

Some of my fondest memories of working in Microfinance Institutions (MFI) were accompanying loan officers on the long and arduous treks through the countrysides of far flung places in search of new business or tracking down delinquent clients.

I remember one of these trips vividly from my work in India. The loan officer and I left the main office at 9am. We got on a public bus for an hour ride into the country side. Then we took another public bus for 30min to a small town. We then hired a rickshaw and drove 20 min down a long dusty road. We were deposited at a mud path, and walked another 10min into the center of a small village. After all this travel, it turned out the self help group/microfinance unit we came to visit to collect money had all left to work in the fields for the day! Despite my pleasure of seeing and traveling through beautiful countryside, it was 2 hours of travel that was in vain.

I had similar experiences in all the countries that I worked for MFIs. Too often, an exorbitant amount of time and energy is expended by the organization trying to reach clients in remote areas. The situation is especially exasperated for potential borrowers who live in the rural regions of the country. These individuals are often the ones most in need of MFI services but because of their geographic distance, they can not effectively receive all the same services as a borrower living in a urban area.

A possible solution to this conundrum is the idea of mobile banking. The basic theory is that a person can use their cell phone to conduct many of their banking transactions. In the past few years, there have been numerous attempts at creating mobile banking platforms for MFIs; however, mainstream success has remained out of reach.

For my part, I am especially interested in the idea of mobile banking. Like in the US, mobile phone usage in developing countries is becoming widespread, and for lowering costs, it seems obvious that MFIs will want to utilize mobile banking technology. If anyone out there comes across companies doing mobile banking, then please feel free to share.

Obama and Microfinance

Still feeling my GO USA! buzz from the recent election, I became very interested in the impact Obama will have on the BOP movement. I was very pleased on what I found. Reading through a blog posting on Microcapital, I discovered that Obama's mother, Stanley Ann Dunham Soetoro, was a "long career researcher and practitioner of Microfinance". She worked with such organizations as USAID, Asian Development Bank and the Ford Foundation--consulting on microfinance, women empowerment and sustainability projects.

Even more interesting are Obama's own comments about poverty and microenterprises, in one of his policy proposals he notes: “The challenge is to build the capacity of communities and countries in the developing world to generate wealth on their own. Building on the growing evidence that micro finance works, an Obama administration will provide initial capital for an SME Fund.”

I have often reflected how it was even possible that microfinance has developed so rapidly in the past few years, with a US administration that has too often believed that force and violence were the first moves for development solutions. I do truly believe that Obama will take a much more level headed, innovative approach to international development and I am optimistic about the long term benefits that the BOP effort will yield.

Obama

As I reflect upon the historical nature of last night's election decision, I feel nothing less than a deep and powerful sense of what it means to be an American. What comes to mind are not the blessings and opportunites that I have been fortunate to have, but the hardships of those that live in places where last night's election could never be a possibility. Of the hundreds of people I have met in developing countries, I was aware that their societies had tall walls that prevented certain people from ever rising up. Last night, a wall was destroyed in America. This wall symbolized hate and fear and Obama and the American people decided last night that this blocker could not stand.

The message of hope and change are universal, and at very least, this election restores America to the beacon it has traditionally symbolized. A place where a person has the freedom and opportunity to pursue his/her dreams. A land that is creative and new that is willing to take risks in a uncertain world. A people who are defiant of tyranny and rejoiceful for their freedoms.

The reality of Obama's election is a testament to the American dream. It feels as though a dark fog is finally lifting over this country and a stigma that I often felt is finally being relieved. Who knows whether Obama will be a good president or bad, but what is clear is that he has inspired a generation of my peers to believe in America, and even more powerful, he has inspired the world that America can lead and be a changemaker for the next century.

Kiva.org and Zimbabwe foreign aid

One of the more interesting websites that has emerged in recent years that combines microfinance and technology has been http://www.kiva.org/. As the website states: Kiva's mission is to connect people through lending for the sake of alleviating poverty.

Kiva is the world's first person-to-person micro-lending website, empowering individuals to lend directly to unique entrepreneurs in the developing world.

I find that I am often asked about Kiva; however, I am curious myself how the system works. The website has profiles of micro entrepreneurs and allows individuals to invest in their loans. Given the difficulties (in terms of communication, technology) of data transfer and the flow of money, that I discovered while working the developing world, does a person's contribution actually go directly to the person applying for the loan? How logistically does Kiva make this happen?

I have posed these questions to my friend Lander Burr, who is currently a fellow with Kiva in Bali, Indonesia. For those who are interested, you can read about Lander’s experience at http://fellowsblog.kiva.org/category/countries/asia-the-pacific/indonesia/.

A recent NYTimes article also caught my eye today.
http://www.nytimes.com/2008/11/03/world/africa/03zimbabwe.html

The article discusses accusations that the government of Zimbabwe misused USD 7.3m in donors funds that were to be used to fight killer diseases. The article is a model example of the conflicting roles and outcomes of government and foreign aid groups. When I first the article, I wasn’t surprised in the least bit that the government of Robert Mugabe has embezzeled funds. The government has repeatedly demonstrated its neglect of the population and preventing donated drugs to reach a target population is just another example of the untrustworthiness of the regime. I think one interesting question is how bottom up approaches and market oriented solutions can survive in countries where the government is so hostile.

Fortune at the Bottom of the Pyramid

One of the books I am currently reading is C.K. Prahalads, Fortune at the Bottom of the Pyramid. The book lays out a convincing argument for how profits and western capitalism can have a meaningful, postive and impactful difference on ridding the world of poverty.

In many ways, this book captures many of the same themes and ideas that I seek to act on when it comes to my view of the relation between international development and entrepreneurship.

One of the themes that especially struck me was the idea of the poverty premium. Counter intuitively in developing countries, it is often the case where the poor pay more while the rich pay less for the same products.

I remember realizing this for the first time after a recent visit to Port au Prince, Haiti. For the research I was conducting, I wanted to buy juice for the individuals participating in the study and to my surprise, I realized that money I had allocated for the expense scarcely covered the costs of half the juice I wanted to purchase. When I asked why the juice was expensive, a local responded that this was just how it was "Things are expensive in Haiti".

Prahalad enumerates several reasons for the poverty premium including the role of local intermediaries and inefficiencies in the distribution system.

I believe that one of the hopes of the book is that by empowering local entrepreneurs in developing economies, the poverty premium can eventually be eliminated.

International Development and Entrepreneurship

The Beginning: Recently (and only after a great deal time and thought) I have decided that the purpose of my near to medium term future will be focused on International Development and Entrepreneurship.

In a sense, this has been clear ever since I graduated New York University in 2005. After graduating, I worked in India as fellow for a microfinance NGO. Working in the most rural parts of India, I helped to bolster local businesses and entrepreneurs from the bottom up.

Later, I lived in Veracruz, Mexico, for a Microfinance Institution (MFI), delivering market solutions to improve the livelihoods of urban poor individuals. Most recently, I assisted in researching and writing a USAID report which sought to understand how inflation is affecting MFIs in four countries.

I hope to use this blog as both a forum and journal. Everyday I read, research and seek to understand the numerous components that make up international development. It is a daunting and challenging activity. I feel, as not to get lost in the sea of information, it is useful for me to keep a record of my findings and ideas.

Through the blogging process, my goal is to record my findings, spread information, relate to you my ideas and exchange new points of view. I have always valued a paradigm shift and my hope is that this blog will be a means to that end. I encourage you to participate in the dialogue with me.

To close, I would like to leave you with a clever way in which technology is bringing awareness to one of the most desperate crises in the international development arena. It is a video game called Darfur is Dying.

http://www.darfurisdying.com/

In the game, you are a Darfur villager living in a refugee camp. The game does an excellent job in highlighting the daily struggles of people in Darfur and is a good way to introduce the topic to children and individuals new to the subject.