Harper's
April 2016 issue

(excerpt)

The idea that unifies and explains all these disparate initiatives is the theology of microfinance. It is hard to overstate the attraction of this magical idea to the liberal class, or at least to that part of it working in the foreign-aid sector. Microlending, such people have come to believe over the past few decades, was the magic elixir for sexism and poverty, the financial innovation that would save the Third World. Foundations embraced it. Careers were built on it. Billions were spent advancing it. The United Nations declared 2005 the International Year of Microcredit. Muhammad Yunus, the Bangladeshi economist who popularized microlending, won a Nobel Prize in 2006. Three years later, Barack Obama gave Yunus the Presidential Medal of Freedom.

And it was all so simple. While national leaders busied themselves with the macro-matters of privatizing and deregulating, microloans would bring the science of markets down to the individual. Merely by providing impoverished individuals with a tiny loan of fifty or a hundred dollars, it was thought, you could put them on the road to entrepreneurial self-sufficiency, you could make entire countries prosper, you could bring about economic development itself.

What was most attractive about microlending was what it was not, what it made unnecessary: any sort of collective action by poor people coming together in governments or unions. The international development community now knew that such institutions had no real role in human prosperity. Instead, we were to understand poverty in the familiar terms of entrepreneurship and individual merit, as though the hard work of millions of single, unconnected people — plus cell phones, bank accounts, and a little capital — was what was required to remedy the Third World’s vast problems. Millions of people would sell one another baskets they had made, or coal they had dug out of the trash heap, and suddenly they were entrepreneurs, racing to the top. The key to development was not doing something to limit the grasp of Western banks, in other words; it was extending Western banking methods to encompass every last individual on earth.

Microlending is a perfect expression of Clintonism, since it brings together wealthy financial interests with rhetoric that sounds outrageously idealistic. Microlending permits all manner of networking, posturing, and profit taking among the lenders while doing nothing to change actual power relations — the ultimate win-win.

Back in the 1990s, Bill Clinton’s administration had made microloans a proud point of emphasis in U.S. foreign policy, and Hillary has been a microlending enthusiast since her first days on the national stage. She promoted it as a form of female empowerment in a famous 1995 speech she made in Beijing, and she supported microlending efforts wherever the First Family traveled in the 1990s — there’s an exhibit on the subject at the Clinton Presidential Library that shows Hillary giving a speech in the Gaza Strip in front of a sign that reads women’s empowerment through micro-lending. In 1997, she cochaired a global Microcredit Summit in Washington, D.C., replete with the usual Third World delegations. Hillary’s own remarks on that occasion were unremarkable, but those of the president of the Citicorp Foundation were well worth remembering. Here is what he said to the assembled saviors of the Third World:

“Everyone in this room is a banker, because everyone here is banking on self-employment to help alleviate poverty around the world.” At the closing session of the summit, bankers joined national leaders in singing “We Shall Overcome.”

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Hillary Clinton is not a callous or haughty woman. She has much to recommend her for the nation’s highest office: for one thing, her knowledge of Washington; for another, the Republican vendetta against her, which is so vindictive and so unfair that I myself might vote for her in November just to show what I think of it. And she has, after all, made a great effort in the course of the past year to impress voters with her feelings for working people.

But it’s hard, given her record, not to feel that this was only under perceived pressure from her primary opponent, Senator Bernie Sanders. Absent such political force, Hillary tends to gravitate back to a version of feminism that is mainly concerned with the struggle of professional women to rise as high as their talents will take them. No ceilings.

As I sat there in the Best Buy Theater, however, I kept thinking about the infinitely greater problem of no floors. On the train to New York that morning I had been reading a book by Peter Edelman, one of the country’s leading experts on welfare and a longtime friend of the Clintons. Edelman’s aim was to document the effect that the Clintons’ welfare-reform measure had on poor people — specifically on poor women, because that’s who used to receive welfare payments in the days before the program was reformed and turned over to stingy state governments.

Edelman was not a fan of the old, pre-1996 welfare system, because it did nothing to prepare women for employment or to solve the problem of day care. But under the old system, at least our society had a legal obligation to do something for these people, the weakest and most vulnerable among us. Today, thanks to Hillary and her husband, that obligation has been canceled, and we do very little. The result, Edelman maintains, has been exactly what you’d expect: extreme poverty has increased dramatically in this country since Bill Clinton signed welfare reform in 1996.

For poor and working-class American women, the floor was pulled up and hauled off to the landfill some twenty years ago. There is no State Department somewhere to pay for their cell phones or to pick up their day-care expenses. And one of the people who helped to work this deed was the very woman I watched present herself as the champion of the world’s downtrodden femininity.

cont'd
https://harpers.org/archive/2016/04/nor-a-lender-be/6/