Saturday, October 6, 2012

GNH, American Dream and Real Life -- Part 1-2

This is my original article as submitted to The Bhutanese, a national newspaper. It was published in two separate parts as part of a debate on theory and practice of Gross National Happiness.

GNH, American Dream and Real Life

Please forgive me: I'm a Hungarian chilip who doesn't permanently live in Bhutan and I'm not a GNH expert. However, I dare to offer some additional thoughts to the healthy discussion provoked by Dr David L Luechauer in Kuensel and The Bhutanese hoping to contribute to Bhutan's future development.

Some of you may think I'm trying to defend GNH and Bhutan against critics. This is not the case, because GNH or Bhutan doesn't need my defense and protection. Personally, I can't see any problem with Dr David criticizing GHN practice without knowing the concept well while relying on his personal and limited experiences. I keep hearing from my Bhutanese friends that he probably did a good service to Bhutan when raising some valid points. He may even be right saying that widespread domestic practice should have predated any extensive international promotion. I can't really judge. 

What I know for sure though is that GNH provides inspiration to many people outside Bhutan, including my friends in Europe, who explore alternative ways of organizing our societies. I say 'inspiration' which doesn't mean that we would like to take GNH into our countries as it is. No, we want to study the concept, see the results and challenges in Bhutan, and then figure out what we can learn from it and how we can apply the learnings. Doing so, we also hope to help Bhutan improve and apply GNH. 

In my article, I hope to add new dimensions to the conversation by focusing on three things: 1) the universal gap between theory and practice; 2) proposed solutions to Bhutan and their viability; and 3) the business sector's role in further developing Bhutan. 

The theory vs. practice gap

I don't know Dr David, but he may have fallen into the trap several chilips did before: prior to his arrival, in his mind, he may have constructed his own Shangri-la or Happiness State with ever-smiling citizens governed by an enlightened policy called GNH. Then, he got disappointed when he found a real country with real people struggling with real everyday problems. And then he concluded that his home country is still much better.

When I was 18 years old I fell into the same trap, but my constructed Shangri-la was the United States. I was living in Hungary in Eastern Europe under a 'light communist' regime and for my birthday I received a BigMac from one of my best friends. He queued for hours in front of the first newly opened McDonald's in the country and I still remember the thrill I had just looking at this small piece of food on the dinner table. It was a precious sacred object, much more than a sandwich. For me, it was the American Dream itself.

This happened in 1988 and two years later we had democratic elections and open market and later I got my dream job at Levi's, the American jeans company. Today, I laugh when I recall the BigMac story. Since then, I've grown up and learned to see the difference between the American Dream and a hamburger. In other words, I know the difference between marketing and reality. I know that the American Dream, which is globally marketed by brand builders, politicians, Hollywood and many US citizens, is not fully practiced in its home country neither. I've been there and I've seen it. It's a political slogan or a well-promoted philosophy, if you wish. Just like Free Market Economy which doesn't exist nowhere due to government's intervention, protection and subsidies, big business monopolies, and human nature. 

And this discrepancy between a well-rounded concept and rugged reality naturally applies to GNH, too. And that's fine. I'm afraid that we, adults, have to accept that GNH and the American Dream are both aspirational concepts of great minds which are marketed by talented political leaders at home and abroad, while imperfectly implemented anywhere. 

Considering this, one may ask how come that US politicians and Dr David are promoting the concept of American Dream or Free Market Economy or Equality or Democracy across the globe if they are not fully practiced at home? How about gun violence, crime, unemployment, homelessness, obesity, environmental degradation, stress, depression, drug and alcohol abuse, debt, high military spending, increasingly limited social mobility, money-driven politics, anti-market government subsidies, stagnating middle-class income, and growing gap between super-rich and the rest of the US?  The US is no longer what it used to be. Shouldn't they just get their own house in order first before trying to sell their concepts to the world? 

You might be surprised, but I think they shouldn't. I think Americans and Europeans - including Dr David - have the right to promote whatever values, concepts, ideas and philosophies they think are right - regardless of their implementation. It can be the American Dream, Free Market Economy, Democracy, The Invisible Hand, Individualism, GNP, Well-being, Christianity, Human Rights, Peace&Love, Tree Hugging, Philanthropy or Superman. Whatever. These constructions of the mind are all imperfect when practiced, but still it's worth globally debating their viability and implementation.  

On the other hand, all men and women are born equal, not only Americans or Europeans. If Dr David has the right to promote his values and criticize those of others - and I strongly believe he has - others have the same right, too. We all have the right to explore alternatives or adjustments to the American Dream, McKinsey, IMF, Hollywood, or Wall Street without immediately being labelled as communist, Marxist, fundamentalist environmentalist, anti-capitalist, or anti-Superman. 

And I believe that GNH as a concept is potentially one of many viable alternatives to our current global socio-economic system in crisis. Again: it's worth discussing it as a concept globally among many others. Even in more developed countries. Regardless of its implementation in Bhutan.

But, as Dr David rightly suggested, we shouldn't get stuck in discussing philosophy too much, but let's pull up our sleeves and get to work.

On Dr David's proposed solutions to Bhutan

Going beyond his personal insights about GNH implementation and Bhutan's economic and social challenges such as alcoholism, I reviewed what Dr David was actually proposing to Bhutanese and I had a hard time to find his solutions either original or applicable or fair. Some seem to make perfect sense like hard work or better public toilets or curbing alcoholism. Others are less convincing. Given our limited time, I just want to comment on some of his controversial proposals:

1. His proposal: Bhutanese should get to hard work to build the economy and infrastructure.

I think Bhutanese farmers work hard enough to be appreciated. I think Bhutanese craftsmen work hard enough to be appreciated. I think Bhutanese doctors, forest engineers, teachers, shoe cleaners, tourist guides, taxi drivers, etc all work hard enough to be appreciated. Constructing roads, buildings, and hydropower stations in Bhutan is mostly done by Indian companies with Indian workers. They have the technology and willing manpower Bhutan lacks, so they are contracted to build. I don't see it as a problem, if properly managed. 

Building an economy takes not only hard work, but time, money, natural resources and favorable trading opportunities. And protection against cheap and/or better foreign products until the domestic industry is strong enough to compete. This complex process requires much more than the 'Just do it' attitude.

2. His proposal: be self-sufficient and produce internal products for internal market.

It's true that there are not many high quality goods made in Bhutan, but it's also true for Europe and the US where most products, including iPhones, are made in China, Mexico, or other countries. Not a single developed country Dr David has listed is self-sufficient in producing goods for their citizens. They all outsource and heavily rely on other countries' resources and labor such as Middle East oil or cheap Chinese workers.

Bhutan was basically self-sufficient when it was an isolated agrarian country. With globalization and uncontrolled urbanization, higher expectations of urban populations have to be met through importing goods. The real question for me is whether Bhutan will be able to generate sufficient income through tourism, foreign grants, and sales of electricity and locally made goods to continue buying foreign products and services, and occasionally reduce its current debt. If not, individual consumption and government spending have to be reduced to a lower level and politicians and citizens should accept that. 

3. His proposal: be driven by Dow Jones and Nikkei, in other words by the stock exchange.

I'm not sure what this means. Can Dr David imagine, for instance, an effective rehabilitation system for alcohol addicts that is driven by the stock exchange index, instead of solidarity, empathy, human caring, family support and love? Companies may be driven by numbers, but not entire societies.

4. His proposal: don't rely on foreign aid.

I agree. It's good to be independent from foreign money in the long run. On the other hand, foreign aid is not necessarily bad and can be used wisely at early development stage. After World War II, Western Europe was basically rebuilt on foreign support: the Marshall Plan of the United States. The same aid was proposed to the Soviet Union which rejected it for political reasons. Well, one can decide today who made a better decision. 

5. His proposal: get back to monarchy so the King has full power to follow Jack Welsh's example who restructured General Electric.

I think it's a bit irresponsible to propose 30 year-old business management techniques to a country's leadership. What Bhutan needs is 21st century solutions tailored to its unique geopolitical situation and culture. A country is not a company.

6. His proposal: look at the US, Denmark, Germany, etc.

Discussing solutions, Dr David compares small Bhutan with the US, Singapore, Germany, Denmark, and Sweden in his article of Kuensel (11 Aug 2012). On one hand, I agree: Bhutan can learn from more developed countries in terms of education system, health care, skilled labor, English language skills, craftsmanship, or entrepreneurial spirit.
However, this comparison has its limitations. Sweden has always been a trading country and it assisted both waring parties during Second World War which helped create a strong industry. Singapore is perfectly situated to be a trading hub which generates wealth. We can clearly see further limitations when we compare populations, geopolitical status, the huge amount of resources these highly industrialized countries use, the garbage and pollution they produce, and the money some of them spend on military projects or government subsidizes in order to protect their national interests and serve their citizens' needs. 

Just on agriculture subsidies: since 1995, $277 billion have been paid in government subsidizes to farmers in the US ( In 2011, direct aid to farmers and market-related expenditure amounted to 30% of the total European Commission's budget. ( This high percentage translated into over $55 billion in one single year coming from tax-payers (including me) to private companies. Recipients of 6-figure agriculture subsidizes in 2012 also included the Queen of England (BBC news). 

I wonder what is the learning in this for Bhutan? Should it use 30% of its public budget to subsidize farmers? Or the learning is actually to avoid such policies? It's not clear in Dr David's recommendation.

Again, no doubt, Bhutan can learn from these so called 'GNP' countries keeping in mind that they have developed their strong economy over centuries of wars, colonisation, slavery, migration and immigration, revolutions, industrial revolution, international trading, outsourcing, social unrests, fiscal paradises, and environmental degradation. In many ways, Bhutan can also learn from other emerging market countries or from smaller countries like Hungary which have gone through major political and economic transition similar to the one in Bhutan.

The business sector's role in developing Bhutan

I think Dr David and I would agree on high importance of the business community in a country's development. Recognizing this importance, GNP is part of GNH which places the business community, with targeted government support, in key position to creating suitable solutions for Bhutan. 

Working with small and medium-sized enterprises at the Thimphu TechPark and Loden Foundation, I observe that local businesses - apart from the need to be more entrepreneurial and professional in their management - need to be more socially and environmentally responsible in their operation. The goodwill is most of the time given, but new entrepreneurs need to find their way of balancing profitability and responsibility. Government incentives, visible good examples from larger businesses, educated consumers, and tailored training programs would help them a lot.  

As a coach, I work with Shoe-Vival/Help-Shoe Bhutan. Started about 2 years ago, this small enterprise has demonstrated that it's possible to provide high quality service in a socially and environmentally responsible way. If they can do it, everyone can at least try. I hope to see a more engaged business community in Bhutan.

As a global citizen who genuinely cares about Bhutan, I aim to make a difference by offering assistance in finding 21st century business management solutions that consider social and environmental impact and suit a small nation like Bhutan. If Bhutan could adapt the latest telecommunications technologies, why not to tap into the latest management techniques and economic models based on stakeholder engagement, sustainable agriculture and tourism, social entrepreneurship, collaboration, ethical business conduct, values-based leadership, frugality, simplicity, locality, corporate responsibility, small and medium sized company development, Buddhist economics, behavioral economics, impact investment, ethical banking, etc. 

Today, I don't think that opening a bottle of Coca-Cola would make me happy and I think twice before buying BigMac, because I know that my purchase could increase the risk of floods in Bhutan endangering the beautiful Punakha Dzhong and modest houses of my Bhutanese friends. That's what I would call globalized solidarity and awareness of interconnectedness. 

Mahatma Gandhi said: "Happiness is when what you think, what you say and what you do are in harmony". Creating this happiness is challenging, but such public debates may help move towards such harmony in Bhutan, Hungary, the US and all over the world - before it's too late.

Thimphu, 28th Sep 2012

Zoltan Valcsicsak used to work for Levi Strauss & Co, the Californian jeans company and he's currently independent Corporate Responsibility Advisor in Europe and volunteer business coach in Bhutan. He's also founding president of the Hungarian Bhutan Friendship Society.

 You can read the article on line in two parts in The Bhutanese:

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