Entrepreneurship and “Conscientious Capitalism”? Economic Solidarity Within the Banco Palmas Network.

Capitalism is often thought of as a struggle between the ‘haves’ and ‘have-nots’. Although the very nature of the economic system is to reward innovative ideas that can survive competition and the ‘free market’, many ‘have-nots’ do not have the same opportunities to succeed as those born with economic resources. The gap between those with capital and those without has gradually widened into a gaping hole that few can cross. While there are certainly enough resources in Brazil to keep all citizens above the poverty line, the reality is that economic survival has been replaced by one of the most acute wealth disparities of any nation in the world. Banco Palmas is one of the few organizations that has managed to bridge the gaps where capitalism has failed to alleviate poverty. Through a unique program of economic solidarity, the organization has started half a dozen cooperative businesses, initiated the use of a unique social currency called “Palmas” in the community, and given numerous micro loans to entrepreneurs within the Bairro. Through proposing what they believe is an “alternative economic system”, Banco Palmas has united a community and increased the overall capital circulating amongst the 30,000 inhabitants.

During my ISP research at Banco Palmas, I examined the role that entrepreneurship plays in introducing solidarity into the Conjuncto Palmeira community. Through a methodology consisting of a series of observation and interviews, I found that unlike traditional notions of entrepreneurship which focus on innovation and individualistic competition in the market, Banco Palmas strives to create a more inclusive system of innovation through collective solutions to problems of wealth generation in the community. Through studying two micro-businesses, PalmaLimpe and PalmaFashion, as well as the Bairro Escola training program, I found that Banco Palmas defines entrepreneurship as a spirit in the community that allows them to work cooperatively towards economic solidarity.

Additionally, I also studied whether or not the efforts of Banco Palmas are part of a potentially prosperous new economic model, or merely a means of economic survival within the existing capitalistic system. While Banco Palmas proposes what they say is an alternative economic system, the reality is that they cannot survive without their connections to the capitalist community. The reach of Banco Palmas is limited to the Conjuncto Palmeiras community, and its small, community scope financially is not based on growth and profit, the way that prosperity is measured in the capitalist system. Instead, Banco Palmas measures their prosperity in the amount of generated wealth, or Palmas, that stays in circulation within the community. They also base their success on the amount of community cooperation and solidarity businesses that join the network, intern Bairro Escola students, and participate in the collaborations organized by the bank. As the goal of Banco Palmas is not monetary profit, but rather sustainable solutions to promote human development, they are actually not a successful economic model, but rather a successful model for sustainable overall development.

Instituto Banco Palmas www.institutobancopalmas.org