- - Thursday, June 11, 2020

On the surface, Jesus’ commandment to “Love thy neighbor” may not seem to have anything in common with American-Indian entrepreneur Paresh Ghelani, BlackRock or China’s handling of the coronavirus outbreak that has taken the lives of innocent souls across the world and brought the global economy to a standstill. 

And yet a closer examination reveals that the common link is a once-in-a-lifetime opportunity to realign the global economic system for years to come. By slowly but surely moving supply chains currently in China back into the United States, we will lay the foundation of economic independence, create millions of new jobs for the American middle class and along the way strengthen America’s national security.

For the past 30 years, U.S. elites, naive policymakers and “vulture capitalists” whose only mission in life is to enrich themselves, have sold the American public a false narrative that trade with China benefits the United States. They also espoused the theory that engagement with the Communist Party will bring about a more liberal China. Sadly, over the past 30 years the reverse has happened. We have neglected to love our own industries and our own neighborhoods, thus impoverishing our own citizens and decimating American manufacturing.

In 1985, the United States imported $3.866 billion worth of goods from China. Today, this figure is $452 billion. Ironically, U.S. labor force participation during this period started to plateau and then fell from a peak of 68% to almost 60%. This figure is even higher for America’s low-skilled labor force and black Americans.

“Love thy neighbor” is a good starting point to begin the process of redirecting entire supply chains from China back to America. By slowly shifting 100% of the current $539 billion trade imbalance with China back to the United States we will create jobs and rejuvenate America’s manufacturing base. 

Paresh Ghelani, a visionary philanthropist and XPRIZE Vision Circle member, has already started following this commandment by loving his neighbors in Galva, Illinois. He and his partners at Global Impact Innovation have quickly established a home-grown hand-sanitizing plant that is not only paying good wages but competing with cheap Chinese products. Now hospitals, schools, health care facilities have access to inexpensive, home-grown supplies of hand sanitizers thanks to Mr. Ghelani.  

What this advocate of free but fair trade saw was an opportunity to give back to his adopted country by proving critics wrong: America can indeed produce quality products across the entire supply chain. In this particular case, Mr. Ghelani was able to look at the supply chain for hand sanitizers and re-evaluate the essential pieces that could be made here in the United States to quickly address the crisis.

The key difference for this practitioner of capitalism with a conscience is his insistence that profit margins need not be astronomical. Apple, whose supply chains are mostly based in China, has a profit margin of 38.1%, while Mr. Ghelani is selling hand sanitizers at pre-pandemic prices. 

The other important commodity Mr. Ghelani has created is good paying jobs for the local community. He is paying his 20-plus workers a salary that is higher than minimum wage, in this case $18/hour. The human right to dignity that comes with a good paying job is the essence of what we today call ESG (environment, society and governance) investing. “You can do well by doing good” says Mr. Ghelani. 

The double bottom line that Mr. Ghelani has created by providing a return on capital and a return on impact is something the world’s largest asset manager BlackRock must take a closer look at since its CEO, Larry Fink, has come under fire for not investing more in ESG projects. Well Larry, meet Paresh!

Every job that is created in America is an investment in a human right — the right of every American man and woman to a decent paying job. This is the essence of ESG and Mr. Ghelani has shown how this can be done. For example, an investment of $10 million by BlackRock in a plant like the one run by Paresh Ghelani could create 40-50 permanent good paying jobs.

Writ large, this means Mr. Fink’s BlackRock can invest in manufacturing facilities across the United States to build more hand sanitizing plants, solar panels, masks, gloves, toys, apparel, pharmaceuticals and food ingredients, etc. Imagine BlackRock investing a portion of its $7 trillion currently under management into plants that manufacture toys in cities such as Baltimore or solar panels in Philadelphia.

BlackRock will not only create jobs but it can ensure a decent ROI by signing off take agreements for these American-made toys and solar panels with the likes of Mattel (for toys) and Aramco (for solar panels). Currently, the global toy market stands at $90 billion and solar energy at $350 billion. In short, America can become an exporter of toys and solar panels.

President Trump should invite Paresh Ghelani to the White House and thank him for showing America how best to move a supply chain back into the United States and in the process lay the foundation for capitalism with a conscience. 

• S. Rob Sobhani is CEO of Caspian Group Holdings.

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