spring2005

BHUMI HARVARD’S INTERNATIONAL DEVELOPMENT MAGAZINE SPRING 2005 COVER: THE DEVELOPING WORLD OF MICROFINANCE IN THIS ISSUE: AGENCY IN THE ANDES BRIDGING THE RIVER IBAR A TALE OF TWO FESTIVALS 2 Bhumi TABLE OF CONTENTS ON THE GROUND 5 AGENCY IN THE ANDES BY FILIP FILIPOV BY KATHRYN BERNDTSON 8 REBUILDING A HOMELAND 10 PHOTOESSAY BY SABINE RONC INTERVIEW 12 FOR A NEW LEBANON BY PASCAL CHAHINE 15 DEVELOPMENT TALK BY CAROLINE SLOAN & HANNAH MA COVER FEATURE 17 THE DEVELOPING WORLD OF MICROFINANCE BY PETER C.D. MULCAHY & YEUNBEE J. PARK BY KYLE KLOPCIC BY MELISSA DELL 24 IRRESISTABLE INCENTIVES 25 REACHING THE POOREST OF THE POOR WORLDVIEW 27 BRIDGING THE RIVER IBAR BY SAMEER NARANG BY MELISSA DELL 30 A TALE OF TWO FESTIVALS PERSPECTIVES 33 BETWEEN DEVELOPMENT AND FREEDOM BY TINA WANG INSTITUTIONS, STUDENT ORID RESOURCES 35 COURSES, AND BOSTON RESOURCES GANIZATIONS, Bhumi 3 Bhumi Volume II, Issue 1 Editors-in-Chief: May Habib ‘07 Tin-Yun Ho ‘07 Layout Editors: David I. Paltiel ‘07 Nicole E. Rosner ‘07 Peter C. D. Mulcahy ‘07 Business Managers: Jacob L. Bryant ‘07 Lindsay A. Freeman ‘07 Cover Editors: Peter C. D. Mulcahy ‘07 Yeunbee Jeanette Park ‘07 Interview Editors: Hannah Ma ‘07 Caroline E. Sloan ‘07 On the Ground Editor: Alex D’amour ‘08 WorldView Editor: Rob Nelson ‘07 Perspectives Editor: Ekua Nkyekyer ‘07 Staff: Kathryn Berndtson ‘06 Joseph Kerns ‘08 Susanna Kim ‘07 Elena Krieger ‘06 Gabriela Pena ‘08 Tina Wang ‘07 Editorial questions or comments? Want to submit an ad or write an article? Please email bhumi.magazine@gmail.com. This magazine was produced with the help of the following institutions: Center for International Development Dear Reader, In the past five years, student body interest in international development issues has soared. Both in class and out, students have begun immersing both their studies and their lives in these issues. And even more importantly, behind this insatiable desire for immersion, behind everything from the Unite Against AIDS Summit and the Darfur Action Group to the Harvard International Development Organization, is a conscious desire not only to understand, but to change—not only to experience, but to get actively involved in the issues troubling the developing world. Surprisingly, however, only two month ago, this growing and vibrant international development community had no published voice. Not a single magazine on campus dealt exclusively with international development issues. Thus, in response to this gaping deficiency, we banded together in order to re-launch the old Bhumi Magazine, reforming it to adapt to the new needs of the student body. Five years ago, Kim Sanchez ’03 and Reema Rajbanshi ’03 had formed Bhumi Magazine as a forum in which students who had traveled abroad would express their experiences through short art pieces, poems, and stories. With this re-launch, we build on that same poignancy by adding the more active full-blooded vision of student participation in global change that students now voice every day on our campus. Thus, on one hand, we have kept Kim and Reema’s disposition to place additional value on articles written by those with direct concrete experience. On the other hand, we have shifted the focus of these articles, replacing passive introspective reflections with active navigations of substantive issues and suggestions of how you, the reader, can get involved. Finally, we have appended an extensive list of on-campus and Boston-area resources to supplement those suggestions. Ultimately, it is our hope that the works contained in this magazine will not only inform but inspire, impelling you to place a personal stake in the momentous concerns that the developing world faces. Hence the reason we chose the title “Bhumi.” This title, which means “the earth” in Sanskrit, signifies our simple belief that any perspective less than global is inadequate. Any purpose, any goal towards which we devote our lives that does not rise above creed, country, or race is unworthy. Without the slightest exaggeration, we believe that we are citizens of the world, both blessed with the opportunity and called with great urgency to commit our lives to the responsibility this brings. This, in a sentence, is the spirit of international development. It is the spirit that increasingly reverberates throughout our campus. We, at Bhumi Magazine, hope eventually to do it justice. Sincerely, Tin and May Weatherhead Center for Int’l Affairs Harvard Undergraduate Council Harvard Foundation International Relations Council Front cover photo by Rohanna Mertens for ACCION. Back cover photo by Alexandra Huddleston, copyright 2005. Both photos are used with permission. On The Ground Agency in the Andes Kathryn E. Berndtson o cuidas lo que no te cuesta,” said Pedro Chuquimarca as he watched my scribbling hand. “You don’t look after that which costs you nothing.” The Andes loomed in the Ecuadorian night, amorphous and dark, and I leaned my notebook towards the light floating from the crowded meeting in the living room of the box-like community center behind us. Chuquimarca, the leader of Ángel Escobar Paredes, one of the best-organized barrios in the country, looked into the distant darkness and sighed as he named government corruption and clientelism the “cancer of Latin America.” However, even as he spoke, these cancers and impediments to Latin American development were being excised from this small community. A steady stream of Kichwa, an indigenous language of the Andes, and Spanish poured through the open door, indistinct by the time it hit our ears. Children of the community members meeting inside dashed around us in the front yard, little shadows in the night, sliding feet-first into gravel mounds, chasing each other back and forth. Inside the community center, their parents marveled to realize that the local government was listening to them for the first time—that their voices mattered and that democracy meant something real. In November 2000, the cantón , or county, of Otavalo, Ecuador, elected an indigenous mayor, Mario Conejo, for the first time in its history. Although indigenous people are a majority ethnic group in the region, their numbers had never before translated into political power. As recently as the 1980s, merely to walk as an indígena through the central square outside the city hall was to expose oneself to violence and ridicule by mestizos. But in the 1990s, the indigenous population of Otavalo experienced an economic revolution that set them apart from the rest of Ecuador’s indigenous peoples. A skyrocketing textile industry gave them the economic means to organize politically. In 2000, the unthinkable happened when Conejo was elected as an indigenous mayor in an openly racist city. Conejo ran on a platform of transparency, citizen participation, and democratization of the municipal government—and he kept his word. In 2003, Otavalo become the first cantón in Ecuador to democratize its public works system, opening government projects to the most qualified applicants rather “N than a nepotistic mayor’s friends and relatives. In 2002, Conejo founded the Office of Citizen Participation and Intercultural Dialogue (OPCYDI), now headed by Galo Santillán. I was fortunate enough to intern in this office with Santillán as a mentor during the fifteen weeks I spent studying in Ecuador from September to December of 2004. Watching a majority indigenous population that had always been under mestizo power create channels of participatory democracy convinced me that development must be a bottom-up process that is locally generated and directed, with democracy as its driving force. Participatory democracy, or the direct, unfettered participation of individuals in the deliberation of issues affecting them, is admittedly unwieldy and time-consuming. After all, there is a reason that we elect representatives to Congress. However, on a local level, and especially in developing countries, participatory democracy provides a useful model. Invoking citizen participation in order to solve local problems allows for subtle cultural needs and historical singularities to be addressed by those who best understand them, rather than the foreign representatives of international organizations staying in the nearest five-star hotel. Though these foreign experts may claim to know what is best for indigenous communities, they will never have this initmate knowledge of the community and must ultimately abandon them. Democracy is not a one-size-fits-all operation. As Conejo and Santillán will avow, the model of participatory democracy in Otavalo was never meant to be a model for other communities. The local government, guided by “the dynamic of the people,” designed its model to reflect the specific historical and cultural needs of Otaveleños. The municipal government recognizes that “general models [of democracy] don’t exist. Each population must look for its own path.” With a great humility absent from American notions of democracy-building, Conejo cautions: “We do not seek to be the model of anyone. We hope to learn from others and share our experiences in beneficial ways, but ultimately democracy must be self-designed.” For Otavaleños, the primary tools of participation have been the neighborhood assemblies, or asambleas barriales, which have taken place in over 40 of its 57 neighborhoods. Each of these assemblies has a similar basic structure. Each begins with a perBhumi 5 An “asamblea barrial,” or neighborhood assembly, meets in the neighborhood of Juan Montalvo in the county of Otavalo, Ecuador. sonal invitation to each neighbor in the community being organized. In a cantón of almost 100,000, dividing the population into neighborhood groups of 30-50 people and coordinating meetings requires tireless efforts by the OPCYDI. But as Santillán affirmed, “The smaller the group of participants, the greater the level of participation—participation is what we want.” The asambleas are scheduled in the evenings so that attendance is higher for those who work, even though it often means 15-hour days for the OPCYDI staff. The meetings frequently take place in dilapidated community centers with roofs so thin that even a light rain becomes deafening, but none of these things deter the most earnest and committed involvement of the OPCYDI and the communities. Each asamblea begins with the citizens outlining the historical and demographic details of their neighborhood, or barrio, which helps the local government prioritize projects—the barrios with the largest populations and the longest history of inadequate services receive precedence as the city allocates its meager $8 million budget. After establishing the community history, 6 Bhumi the participants proceed to elaborate “lo más feo” or “the worst part”of their particular neighborhood, articulating frustrations about everything from the lack of sewage systems and paved roads to under-utilized green space. Next come suggestions about the best parts of the neighborhood, which sometimes are nothing more than the solidarity among its residents. Santillán and his staff then ask what commitments the community can itself make towards alleviating its problems. After articulating specific projects, each community member, including children, is given two stickers and the chance to vote on what projects they would like to see executed. As I watched community members approach the easel listing possible options and place their stickers beside their preferred projects, I noticed an excited incredulity in them, a smile or a laugh that could not be suppressed as they exercised the agency so long denied them. After the voting, the participants make concrete plans about how to go about enacting the decided projects. In many of the asambleas I attended, this voting resulted in mingas—community actions—planned for the following Sun- day morning. During a minga, community members, equipped with municipal bulldozers and dump trucks, pour out of their homes to clear streets, build parks, and pave roads. As adults work at the mingas, children run through the streets distributing generous portions of food donated by community members: 2-liter soda bottles, chicha (corn-derived beer), buckets of rice and corn, strips of chancho (pig), and ají (a chili-based salsa). For these Ecuadorians, development is an act of love—they make sacrifices in the hopes of seeing their children live better lives, and they create channels for tangible, rapid change in ways that integrate Andean values of reciprocity and community. This locally designed and implemented process of participatory democracy manifests the greatest hope I have for international development. The World Bank has recognized the power of this kind of capacity-building and has adopted this method of participation in some of its development policies. But international organizations can do much more to fully capture the power of participatory democracy. Often, money from the World Bank, USAID and other foreign organizations ends up in the hands of large corporations in Ecuador. And the strings that come attached to IMF loans can thrust developing nations into the deep end of capitalism without How can I get involved? Consider study-abroad programs that emphasize immersion in the economic and social realities of developing countries. A few of the programs specializing in international development include the University of Minnesota’s Studies in International Development (MSID) with programs in Ecuador, Ghana, Kenya, Senegal, and India (http://www.umabroad.umn.edu), the School for International Training with programs in dozens of countries in Asia and Europe (http://www.sit.edu); and the International Center for Sustainable Human Development in Latin America (http://www.cidh.ac.cr/study). making space for their needs and input. Real international development requires more than the rigid top-down models of economists; it requires vigilant humility and a respect for the autonomy of those being “developed.” If we are serious about alleviating poverty in the developing world, international organizations need to stop feigning infallibility and start acknowledging local agency. Kathryn E. Berndtson ’06 is a special concentrator in Applied Social Ethics in Eliot House. She can be reached at berndts@fas.harvard.edu. Photographs are taken by Kathryn. Citizens at a “Minga,” or a community action event, in La Manosca, Ecuador Bhumi 7 On The Ground Rebuilding a Homeland Filip H. Filipov nyone who followed the events of the Balkan wars remembers the gripping images of fleeing refugees that accompanied the news of the conflict. But after the fighting subsided, media attention turned elsewhere, focusing on the negotiations of international players and the political and economic strategies for Bosnia and Herzegovina’s recovery. Consequently, few were able to see the vast influx of returning refugees and the dramatic transformations they wrought after they resettled in their native countries. For far from being helpless victims of conflict, they have become engines of development, driven by the earnest determination to rebuild their lives and their communities from the ground up. Now, with the world focused on areas of conflict from Iraq to Darfur, an examination of the role of refugees in the post-war Balkans can provide insights into the difficult process of reconstructing self-sustaining societies. A former part of Yugoslavia, Bosnia and Herzegovina sank into war shortly after announcing its independence in 1992. After A the death of 278,000 citizens and the displacement of 1,300,000 refugees, the Dayton Peace Agreement finally put an end to the carnage in 1995. But the post-war picture was grim. Troops left behind ruined cities, shattered social structures, and an almost non-existent economy. Today, the picture of Bosnia and Herzegovina is far brighter. Since 1996, financial assistance from the European Union and foreign nations has helped Bosnia and Herzegovina make major improvements in infrastructure. Now, major cities such as Sarajevo, Mostar, and Banja Luka have surpassed their pre-war levels of productivity and rebuilt roads and railways. The Bosnian economy has reached new heights—exports have reached $1.28 billion—as it slowly re-integrates into the global economy. Post-war Bosnia has also established a democratic republic with a sound legal system and guaranteed political rights. This reinforced political system has in turn strengthened social cohesion by creating bonds between previously separated ethnic groups and geographic regions. Reconstruction in crumbling villages is now a common sight in the Bosnian countryside. 8 Bhumi Although EU officials believe Bosnia and Herzegovina’s progress can be attributed mainly to successful EU-financed infrastructure projects, Bosnia and Herzegovina’s revival cannot be explained by structural advancement alone. The human side of development has also played a major, if unforeseen, role. During the war, most refugees escaped to more affluent and democratic Western European countries, providing refugees the opportunity to gain invaluable skills and perspectives. Later on, the post-war reforms in the political and economic systems of Bosnia and Herzegovina created incentives for the return of these refugees, attracting more than a million Bosnians back to their homeland. Using the knowledge and skills that they acquired during their time outside the country, these ex-refugees have revitalized the Bosnian economy, boosting GDP growth from 2.3% to 3.5% in just two years. In particular, the combination of their skilled labor and their intimate knowledge of the country has given them an edge over foreign-educated laborers who lack the ability to adjust to the business environment in Bosnia. Although investment in technology and infrastructure through aid programs created the basis for Bosnia’s development, real results followed only when refugees, bringing home unique experiences and skills, returned to rebuild. Refugee participation in development, however, is not confined to the skilled adult population. My personal experience reveals that young refugees have also been seeking ways to improve their Bosnian communities. Returning youth in Sarajevo and Mostar, for example, work for a variety of NGOs on local projects directly impacting economic and social development. At an NGO fair in Mostar in 2001, I had the chance to talk to refugee students representing more than fifty organizations, at least half of which were founded locally after the end of the war. Almost unanimously, they spoke of a desire to transfer part of their knowledge to not-sofortunate youths who had been unable to leave the country during the war. The source of their inspiration was clear: when asked why they joined NGOs and service organizations in the first place, most responded, “Such things are popular in the West!” These refugees are an invaluable asset to Bosnia. Instead for waiting for foreign aid, these enthusiastic young people, having tasted democratic civil society, have decided to take matters into their own hands. The enthusiasm of the youth refugees has been contagious: Bosnian youth who did not leave their country have also taken up this enterprising spirit. In Sarajevo, I met Goran, a 19-year-old Bosnian who had spent three months in a cell during the war when he was thirteen. As we discussed the current situation in Sarajevo, he eagerly explained how things had changed over the last few years. “You can see all these foreigners and foreign nationals [this is what many Bosnians call returning refugees] who work on all these great projects regarding our own future. Just thinking about it makes me not only proud to be a part of their programs, but also makes me want to learn how to do things myself.” Goran is not the only young person who feels this way—large numbers of youth have been inspired to join initiatives that are increasing the social capital and cohesion of the country. Although this positive trend might not have gained momentum without outside assistance, it is ultimately the returning refugees who have provided the means and the spirit necessary to promote progress and development in Bosnia. The Bosnian example provides an important lesson in thinking about rebuilding societies torn by war. Although efforts to strengthen the political system and improve infrastructure are absolutely necessary to promoting stability and economic growth, no amount of foreign aid can buy the social capital that returning refugees bring to the country. Returning Bosnians’ personal attachment to the country, coupled with exposure to democratic political systems and market economies, make them an invaluable development asset. The story of Bosnia and Herzegovina may turn out to be exceptional. In many cases, it may not be possible for refugees to flee to democratic, prosperous nations, and it may prove difficult to lure refugees back after the war. Still, strategies for re-patriating human capital should be given more thought when designing strategies for development. Refugees who are passionate about their homeland and determined to rebuild just may be the key. Filip H. Filipov ’07, a government concentrator in Winthrop, can be reached at ffilipov@fas.harvard.edu. He worked in Bosnia and Herzegovina while volunteering with Between-the-Lines, a service project run by Community Arts Berlin. Photo taken by Sameer Narang ‘05. How can I get involved? Volunteer in Bosnia. Work with a resettlement program with the International Rescue Committee (www.theirc.org) or volunteer for a myriad of other projects in Bosnia with the Volunteers for Peace (www.vfp.org). See a list of additional NGOs at www.ku.edu/~herron/bosnia. Community Arts Berlin can be found at www.communityarts.de. Bhumi 9 10 Bhumi Bhumi 11 Interview Lebanese protesters march in Beirut to demand the withdrawal of Syrian troops. For a New Lebanon Pascal Chahine B eirut, Lebanon—In a blink of an eye, Lebanon has changed. The assassination of former Prime Minister Rafik Hariri has spontaneously transformed the dynamics of this tiny Middle Eastern nation, causing hundreds of thousands of Lebanese citizens from all backgrounds to take to the streets to protest Syria’s military and political presence. And the protesters prevailed—the pressure of the demonstrators forced the government to collapse and Syria to withdraw all of its troops. But in a country historically torn by religious divisions, the real question now is whether this new dynamic can inspire enough social cohesion to bridge these divides and establish peace. One Arab non-governmental organization, The Tharwa Project, is hoping to take advantage of this new growth in Lebanese solidarity to push for awareness of minority rights. The group was founded in Syria in 2001 by a liberal activist named Ammar Abdulhamid to promote human rights in Syria. In March, BHUMI approached the Tharwa Project’s Lebanese coordinator, Sally Abi Khalil, to talk about the Project’s progress and discuss whether Lebanon’s re-energized civil society had the power to use its recent victories to further the country’s political development. BHUMI: What is the Tharwa Project? Sally Abi Khalil: The Tharwa Project started a little over a year ago. It is an independent initiative launched by Syrian social analysts, intellectuals and liberal academics that seeks to provide a forum for identifying the aspirations and addressing the concerns of the various ethnic and religious minorities living in the Arab world. The Tharwa Project can be characterized as 12 Bhumi an awareness campaign—a forum for debate about issues that tend to be ignored or registered as taboo in the region. Issues such as human rights and women’s rights are topics with which the Arab world rarely deals. B: How would you characterize the role of the Tharwa Project in the social development of Lebanon? SA: It is not an infrastructural economic development project. It is an educational project which falls under the social development of the country. For conflict resolution to occur, we need this kind of forum for debate—an independent forum—in which we can voice our opinions without being scared and introduce new ideas and thoughts to people from different areas across the country. These people can then learn how to be more tolerant of minorities, realizing that other opinions exist out there which deserve to be voiced. A lot of people don’t know that. They immerse themselves in their own community, and that’s all they see. B: How would you describe the current political environment in Lebanon? SA: Well, it’s definitely positive. What is happening now in Lebanon should have happened a long time ago. There has been a sentiment of “enough is enough” building up for quite a long time. It is unfortunate that it took the death of such a great man to catalyze the unification of the different confessions that we have been seeing recently. Obviously divisions are still there; that’s not going to go away. But all these confessions are listening to each other regardless of the differences. They’re being more tolerant and open to other opinions. Even when I went to the [pro-Syrian] Hizbollah rally—although there were many negative comments regarding the opposition—everyone would say: “We respect their opinion. They have a right to say what they want. They have the right to demonstrate. But we also have the right to demonstrate. Just like we stand by and listen to them and hear them, they should do the same for us.” And that’s quite something to hear Lebanese people say that. B: Samir Khalaf, Director of the Center for Behavioral Research and Professor of Sociology at the American University of Beirut, characterized the phenomena that you described as “a new political language.” In your opinion, will this new political language become a permanent aspect of Lebanese society? SA: I’ve been trying to figure that out for quite some time now. I think something has been born. Whether this is a consolidated movement that will last a long time… I don’t know. It’s too early to tell. But it’s definitely something that’s going to last until the [May 2005] elections...And I think it’s going to continue until we have free and fair elections. B: Do you feel that current political unrest has the potential of creating divisions within minorities in Lebanon? SA: Politics does divide along confessional lines and that in itself is a problem. The system itself is flawed, but it’s the only system that can work for Lebanon now and that has worked for Lebanon—more or less—since its independence. But does the current political situation have an effect? I mean it is having an effect. You have arch-enemies uniting. You have a dialogue going on. The political game is being fought out and played out more or less transparently. All confessions are calling for free and fair elections and for elections to take place on time. So yes, the current political situation does have an effect. Assessing the current atmosphere, I think it is a very positive effect. B: How do Tharwa’s Lebanon activities compare to those in the rest of the Arab world? SA: This new idea of debate extends throughout the Middle East. Lebanon is a unique case because we are recovering from a war. But we really want to immerse ourselves in the Arab world and receive input from everyone. There are minorities throughout the Middle East—Lebanon is a collection of minorities and there are minorities in Syria, Iraq, Yemen, Saudi Arabia and Egypt. Because of the types of regimes currently controlling these countries, these minorities don’t have many rights. They suffer a lot. Pascal Chahine ‘06 is a Social Studies concentrator in Eliot. He can be reached at chahine@fas.harvard.edu. Photograph also by Pascal. How can I get involved? Get an internship in Lebanon! The UNDP office in Lebanon is always looking for interns. Applications for a Lebanese internship can be accessed at http://www.undp.org.lb/vacancies/internship/index.html. Other international and local NGOs are also desperately in need of volunteers. Also, you can volunteer at THARWA: just email Ammar Abulhamid, the director of THARWA, at coordinator@tharwaproject.com. Bhumi 13 Interview Former Ambassador Vicki Huddleston attends a celebration for the opening of a new school in Likraker, a nomadic community outside of Tombouctou, Mali. The school was built with U.S. Department of Defense humanitarian funding. Development Talk Caroline Sloan and Hannah Ma icki Huddleston, a career diplomat who has served as ambassador to Madagsacar and Mali, is at the forefront of the debate about how American policy can best be used as a tool for development in the African and Latin American worlds. A fellow at the IOP this semester, she leads a study group called The Politics of Foreign Policy: the American Colossus in the Eyes of the Developing World; Dare We Change that Image? We sat down with Ms. Huddleston to discuss issues of development in Africa as well as her perspectives on the changing political atmosphere in Latin America. BHUMI: Coming back from being an ambassador to Mali, what do you see as the most fundamental development issues facing Africa today? 14 Bhumi V Vicki Huddleston: When you look at Africa there are so many issues. Some people say it’s poverty. But that’s so all-encompassing that it’s almost unfair. If you want to pick something I’d have to say that the issue is employment. These wars in Africa are all actually fed by the thousands of unemployed young men who have no future, who have no money, and who often aren’t educated at all. A warlord can go out and recruit these kids once they migrate to the city. And so many of them are migrating—the land on which they would have worked, which belonged to their fathers, is not available—there are too many young men with too little land. If they do stay, they listen to the radio and start thinking, “Gee, things are pretty interesting in the world.” So then, often even those young men who could stay migrate to the city. But then they end up on the curb. They spend most of the day drinking tea in front of a friend’s tiny one-room teahouse and don’t have anything to do. If this continues, I don’t think we can resolve Africa’s problems, because its youth won’t have a future. B: So what do you propose for African governments to do? V: I’ve been thinking about this quite a bit lately. I think governments should employ their military or some other organized social body in public works projects similar to Roosevelt’s CCC program during the Great Depression. To do this, they need more resources to pay salaries and to underwrite construction projects, like bridges and roads. The World Bank could use some of its funding for infrastructure projects that, with some training, these young men and young women could become employed in. B: Even with greater resources, is it realistic to expect that African states in their current form could achieve this development of infrastructure? V: I think African states would do it if they knew that the money was there. In that respect, I think it’s more our problem than theirs, because that’s not how we advocate development anymore. USAID does not like to do infrastructure. It likes to do teacher training and PTAs to get parents involved in the schools. It likes to do vaccinations, it likes to train medical personnel, and it likes to do microfinance. USAID isn’t big on doing roads and bridges. And yet the best project I’ve seen was one in Madagascar. The project had a contractor who was doing farm-to-market roads. The contractor designed and laid out the roads. People were out there breaking rocks and putting the rocks on the road . . . and it was working. For us, and for the developed world, it’s a matter of being willing to change the way we carry out our aid programs. And we should. The World Bank, for example, in Mali, actually distributes only 17% of its allocated funds, because the capacity of the people who are carrying out the projects is limited. Only a limited amount of people really have the education, training, and ability to oversee a World Bank project. It’s a real organizational challenge. The United States needs to be working with African governments, needs them to be responding to and demanding human resources from our government. The French are doing the same work. The Germans are doing the same. We’re not very well-coordinated. I think it would be easier for African countries if they knew there was a pot of money that they could draw on to use for their job corps, to build on their infrastruc- ture. B: You also worked quite a bit in Cuba. Would you suggest a different role for us in Latin America than in Africa? Or would you advocate a similar one? V: I don’t think I know enough about Latin America to know what the solution is. I know what the solution is for Cuba—I think it’s some balance between isolationism and empowerment of the people. We should drop those sanctions that block information and humanitarian supplies from getting into Cuba and allow foreign affairs councils to go down to better study Cuba’s dynamics. Bush’s policy allows Castro greater control because we have no influence in Cuba’s politics. The only way you can have change in Cuba is to impose it from the outside, because the regime is corrupted. You can’t carry out change in a system that’s corrupted. But what does that mean? It means somebody from the outside has to come and impose democracy. B: How did you become interested in international development? V: I think I was always sort of interested, but when I was a freshman in college, my parents and I took this road trip to Mexico… Oh, it was so incredible to meet all these people who spoke a different language and lived a different type of lifestyle. After that I knew I was never going to be happy living my life in the United States—I’d have to live overseas. I took the Foreign Service exam and I failed it, so I went to the Peace Corps in Peru and lived in a beautiful city, which had great volcanoes behind it. I was able to use financing from USAID to help build houses for the railroad workers’ union and the beer workers’ union. After that, I went to Brazil where I met [current president of Brazil] Luis Inácio Lula da Silva. His was the most powerful union. Even then, he had a vacation area for his workers. It was incredible. Then I came back and went to Johns Hopkins so that I could get smart enough to pass the exam, and then I went into Foreign Service. B: When you were in the Peace Corps, you were doing work on the community level. But you were saying before that the United States needs to help with changing larger international structures. What do you mean by that? V: The Peace Corps [employs] pretty much the same kinds of kids—young people in their twenties, idealistic, smart, Bhumi 15 generally from middle class families throughout the United States who want to see what it is like to help people and to live in another culture. Many of them go on to be in USAID, the State Department, the World Bank, and NGOs. But I think it’s time for the Peace Corps to articulate a new vision of what they’re doing and where they’re headed—maybe reiterate the old vision that John F. Kennedy had of working with people in other countries and helping them to have better lives, which comes back to the idea of empowering people. The Peace Corps is doing a great job. But I think it needs an overarching vision of why it is there and what it hopes to accomplish. B: How much good do you think these micro-level programs can do? Are they valuable beyond nurturing the next set of leaders? V: I think that those goals are not incompatible: you go through the country, you work with the people in the country, and then by being in the country, learning the language, and understanding the culture, you’re better prepared to go into broader aid work. For example, when you’re in a village and the village really wants to get fresh water but doesn’t know How can I get involved? Vicki’s suggestions: Get a summer internship with the US State Department: visit http://careers.state.gov/student/. Join the peace corps after college: visit http://www.peacecorps. gov/index.cfm. Attend Vicki Huddleston’s study group! It is on Tuesday afternoons from 4pm to 5:30pm in Littauer building, room 166. how to go about it, and you work with the leaders of the village to find a company that will drill the well and find the financing…it helps, it both educates the village and provides clean water that will save lives. So yes, these programs definitely do good and help people improve their lives. Caroline Sloan ‘07, a History concentrator living in Kirkland, can be reached at csloan@fas.harvard.edu. Hannah Ma ‘08, an economics concentrator living in Weld, can be reached at hannahma@fas.harvard.edu. Photos and copyright by Alexandra Huddleston. Photographs are used with permission. Ambassador Huddleston greets dignitaries who have been invited to a feast celebrating the many cultural and humanitarian projects the US Embassy has sponsored. The dinner served as a last farewell to Huddleston, who retired soon after. 16 Bhumi COVER MICROFINANCE BY PETER C.D. MULCAHY & Y. JEANETTE PARK THE DEVELOPING WORLD OF magine Josefina Martinez. She is one of the millions of people all over the developing world who is or has been a client of the microfinance industry. Ask her about it, and she can tell you about the difference the loans from the local microfinance organization made in her life. Before she obtained the fifty-dollars she needed to buy the sewing machine for her clothing shop, she and her four children went hungry at least one day a week. She used to sew clothes by hand for sale at the local market, but she hardly earned enough to feed and house her family adequately. Josefina knew that she could make more clothes with a sewing machine, but there was no way she could ever save enough money to buy one. ROHANA MERTENS ACCION I Bhumi 17 The Developing World of Microfinance hat is, until she was granted a loan from the local microfinance organization. The loan rates were high, but not higher than the local moneylender’s rates, and moreover, the organization seemed willing to continue giving her loans as long as she adhered to the repayment schedule. She purchased a used sewing machine with her first loan of a $100 and increased her production by five hundred percent in the first month. She paid back her loan within six months and immediately took out another loan to buy higher-quality thread for embroidery. Five years later, Josefina is still a client of microfinance. Her earnings have supported her children through secondary school, and now, she employs her sister in producing and selling children’s clothing. Or so the typical microfinance success story goes. But if the thousands of success stories listed on the websites of microfinance institutions—MFIs, for short—are all true, the divide that pervades the scholarly and practical discussion of microfinance’s effectiveness is hard to explain. Dr. Isobel Coleman, an expert on microfinance at the Council on Foreign Relations, characterizes the lack of consensus plainly. “People like to take potshots at it,” she said in an interview, “but I don’t see anything else out there that’s any better.” Talking about criticisms of microfinance, she sounded almost exasperated. “It’s not the only solution,” she said, “but it is an important tool in the development toolbox.” Dr. Coleman’s exasperation is telling. Despite microfinance’s worldwide presence, it is anything but universally lauded; the fact that the UN General Assembly named 2005 the “International Year of Microcredit” provides a false sense of unanimity (see sidebar on p21). In reality, experts, officials and practitioners are lined up on either side of the contentious debate—one whose outcome will decide whether we look back at the Year of Microfinance as a celebration—or a farce. What is Microfinance? Microfinance is an umbrella term for a number of distinct financial services and products—such as savings, credit, and insurance—involving small amounts of money for low-income clients. This is microfinance’s formal definition; popularly, it is used interchangeably with microcredit, perhaps the most critical service under the microfinance umbrella. Microcredit involves making small loans—as little as $75—available to low-income individuals or groups in developing countries (though not exclusively; there are MFIs in the U.S. and 18 Bhumi T Q&A – MicroWhat? An inclusive financial sector is one that does not exclude lowincome people from accessing credit, insurance, remittances and savings products. In many countries, the for-profit financial sectors do not provide these services to the poor. Microfinance is the management of small amounts of money through a range of products, and a system of intermediary functions that circulates money in an economy. It includes loans, savings, insurance, transfer services and other financial products and services. Microcredits are small amounts of money made available to a client by a bank or other institution. Often referred to as “the fuel of private sector development,” microcredit gives people the means to invest in their human and productive capital more profitably and according to their own priorities. Microsavings are deposit services that allow one to store small amounts of money for future use. Such savings mechanisms allow households to store money when they have excess income to meet their consumption needs during emergencies. The poor save to: guard against income shocks, such as illnesses and bad harvests, build an asset base, prepare for old age, etc. Canada). These individuals or groups then use their loan, which is usually repayable over the course of a few months, to invest in livestock, supplies for traditional crafts, or other capital. Ideally, clients use their loans and capital to become more self-reliant by starting small businesses and turning their investments into profits. Microfinance isn’t exactly a new idea in development policy. While microfinance as we know it today is a product of the 1970s, the roots of microfinance are much deeper. Starting in the late nineteenth century, credit cooperatives were formed all over Europe—beginning in Germany and spreading to Ireland during the Great Famine and then to Italy—to help alleviate the plight of the poor. The credit cooperative model found its way to colonial India as the British searched for ways to alleviate poverty there, and it spread through the twentieth century, especially in what is now Bangladesh. The largest MFI in the world was born in the 1970s when an economics professor named Mohammed Yunus began making small loans from his personal savings to Bangladeshi locals. Thirty years later, his Grameen Bank (Grameen is the Bangla word for village) is considered the grandfather of all modern MFIs and has had over four million borrowers. Since its founding, Grameen Bank has disbursed some $4.7 billion, the vast majority of which has gone to women. The World Bank estimates that there are as many as 7,000 other MFIs serving 16 million people around the world—a number which, surprisingly, covers as little as 4% of the potential microfinance market. All of this activity According to ACCION international, microfinance helps many like Fatouma Djibril Issifou jump-start their small to medium sized businesses. Photo by Rohanna Mertens for ACCION. translates to billions trading hands through microfinance. Contrary what the word “microfinance” might imply, it isn’t all about the money. Proponents of microfinance programs point to its potential to support other development objectives: Coleman, who focuses on how microfinance can advance women’s rights, cites positive links between microfinance and school enrollment levels, child nutrition and maternal health, among others. How is microfinance such a magic bullet? Many of these positive side-effects, Coleman says, are due to microfinance’s great impact on female empowerment. A vast majority of the world’s poor are women and children, and most women in developing countries lack access to employment and thus, self-reliance. Studies, including Coleman’s, seem to indicate a link between female access to microcredit and female social capital—their income translates to a greater role in decision-making, family planning, mobility, and greater political awareness, among other things. Increased financial independence means that children can attend school rather than help the family subsist, mothers have more choices in what they feed their children and themselves, and can afford better medical care and contraception. Some MFIs even institutionalize their potential for social change. Grameen, for example, asks its borrowers to subscribe to a Ten Commandments-like “16 Decisions” which govern their lives—and serve as a precondition for borrowing. The sixteen precepts encourage the creation of small families, the education of children, cleanliness, frugality, a sense of justice, and “The Four Principles”: discipline, unity, courage, and hard work. If microfinance has the power to inspire all these things, it could be the only tool the developing world needs. Yet the skeptics aren’t completely sure. There seems to be a dearth of research into the direct impact of microfinance institutions on the developing world, in a micro- or macrosense—a gap to which these detractors readily point to. When I asked Gates Professor of Developing Societies Michael Kremer what he had for comment regarding The Year Bhumi 19 of Microcredit, he replied tentatively. “My main comment would be that we currently don’t have as much evidence as we should on the impact of microfinance,” he said. “This is an area where it would be straightforward to do a proper randomized evaluation to measure impact, and yet it has not been done.” The answer to why such studies may not have been undertaken depends on whether you’re a proponent or a skeptic. Supporters and practitioners of microfinance argue that the onthe-ground results of their efforts are clear and that it would be a waste of already scarce resources to pay for scientific studies of obvious results. Others are more cynical, arguing that a true analysis of the impact of MFIs on development would show them to be ineffective—or at least less effective than they claim to be—and thus the studies are never undertaken. Because many MFIs are funded in part by donors who aren’t themselves practitioners or experts, such data could be damning. Regardless of the true impact of MFIs on development and on the lives of the poor, a clear fact remains: microfinance is growing quickly. With an estimated 900 million households without access to formal financial services, NGOs and commercial outfits are rushing to fill the void with a clientele expanding at more than 35% each year. If the microfinance train appears to be without question rumbling on, it seems only natural to ask: where is it going? Microfinance Now Michael Chu, a professor at Harvard Business School and the president of ACCIÓN Internacional, says with little hesitation, “the cutting edge of microfinance is the commercialization of microfinance, the insertion of microfinance into the world of finance.” According to Chu, the last two decades have witnessed the emergence and growing dominance of larger, semicorporate, and professional organizations in the microfinance market. Many informal and often local NGOs providing microfinance services still exist, but for Chu, they are overshadowed by larger and more profit-oriented MFIs. But as president of one of the world’s largest microfinance organizations, perhaps It is often alleged that semi-corporate microfinance institutions are unable to reach the poorit’s not surprising that Chu would say so. est of the poor. Photo by Erick Ivan de Leon for ACCION. 20 Bhumi ACCIÓN International exemplifies the brand of professionally staffed and market-philosophy-driven organizations to which he refers. In the last twenty years, they’ve become the major actors in the microfinance field by almost any measure: by Chu’s estimate, of the 7,000 to 12,000 MFIs currently in existence, 40 institutions have the lion’s share of the market. Yearly industry reports show that their share is only growing. ACCIÓN alone reports that they served over 1.1 million clients in 2003 and disbursed over $1.2 billion dollars in loans. Compare that to the statistics on a local NGO such as Equipo de Mujeres Comunicacion y Produccion (EMCOP), a Christian organization whose staff consists of five local Peruvian women and whose client base ranges around one hundred. So what about these ten thousand smaller MFIs? These “grassroots” organizations usually seek not to deliver microfinance credit to clients so much as to give clients all possible tools to lift themselves out of poverty. Such organizations seem to take a more holistic view of poverty alleviation, offering workshops on basic business management, healthcare, and human rights along with the loans—in other words, programs that some critics believe are a waste of resources. Unlike their more corporate counterparts, the client base of these smaller MFIs may range from one hundred up to a few thousand customers, and their staff members are more likely to resemble humanitarian or social workers rather than bankers. But the most important difference between these two types of MFIs, for better or worse, is that many of the grassroots MFIs do not set financial sustainability as a serious goal or will never reach self-sustainability in the foreseeable future. They are kept afloat through state subsidies, private donations, contributions from businesses, as well as their own revenues from loan interests. In contrast, many of the larger, semi-corporate organizations have explicitly set financial self-sustainability as an absolute goal, and several, including many of ACCIÓN’s partner banks, have even managed to make a hefty profit. Here the debate becomes a little hotter. When it comes to the ability of semi-corporate MFIs to serve the poorest of the poor in developing countries, some—like Beatriz Armendariz, a lecturer of economics at Harvard—aren’t completely sold. “They [semi-corporate organizations and grassroots microfinance enterprises] are complementary,” Armendariz said in an interview. “Grassroots microfinance enterprises generally serve poorer clients, while semi-corporate organizations generally serve the less poor that…cannot obtain a loan from commercial banks.” Others, like Chu, wouldn’t quite use the word “complementary;” rather, they don’t think the unsustainable grassroots organizations should really exist at all. “The reason why microfinance continues to have 12,000 practitioners is that it deals with the poor and therefore has attracted—and rightly so—the attention of the international donor community,” he said in our interview. “And because there is a lot of donor money interested…that has prolonged the existence of organizations that would have otherwise fallen by the wayside.” Microfinance: an effective response? All of this methodological debate about which MFIs are most effective belies another debate entirely: there is hardly any agreement as to how effective MFIs are at all. The usual methodological problems with trying to prove causation — that access to reliable financial credit has improved the quality of life for the client—are compounded by the fact that there is relatively little hard data collected on the impact of these loans. Many grassroots NGOs lack the technical skills and savvy to conduct a proper survey and analyze the data. But even with the proper data, impact assessment is difficult because of factors such as self-selection of clients and the use of loans for purposes erhaps the most striking trend in the microfinance field is the amount of attention it has been receiving from the media—especially after the United Nations declared 2005 as the Year of Microfinance. While it states that microfinance is only one important tool in poverty alleviation, the UN has clearly publicly jumped on the microfinance bandwagon. Partially prompted by the Microcredit Summit in 1997, where MFIs, government agencies, and members of the private sector pledged to reach 100 million of the world’s poorest families and raise over 20 billion dollars for MFI start-ups by the year 2005—both goals are well on their way to being reached)—the UN General Assembly designated 2005 as the International Year of Microcredit in 1998. The UN runs its own microfinance programs through its various development agencies and also supports the work of grassroots microfinance NGOs. Bhumi 21 P The Year of Microcredit of loans for purposes other than investment may complicate the interpretation of data. Perhaps even more difficult is deciding the criteria that measure “success” in microfinance. Community development, female empowerment, capital investment, effect on education, employment levels, and nutrition are all possible candidates, and are often used jointly in impact reports. These difficulties in evaluating microfinance leave us wanting for data. So far, the few studies that have been done suggest that microfinance services offer the greatest help to those in the deepest poverty, and while they provide some spillover effects into the economy beyond the microfinance Smaller microfinance NGOs frequently couple loans with education programs in business manclient (for example, generating local agement, health, and other trade-related subjects. Courtesy Melissa Dell ‘05. employment), they have yet to prove themselves as instruments for significant macroeconomic rates is far from absolute. Some view MFIs as a kind of infant change. industry that needs public and private subsidies to get off the ground, whether in the form of reduced interest rate to the Obstacles organization, reduced interest rate to the clients themselves, Besides the lack of hard data and thus any kind of consensus or in the form of donor money and volunteers. on the general effectuality of MFIs, microfinance faces other From this discussion it would seem that everything problems. Among the largest problems is the politicizing is up for debate. To some extent, that is true, except for of microfinance by governments of developing nations and one thing: without a doubt, the use of microfinance as a the inappropriate subsidizing of loans. Politicians have been poverty-alleviation and micro-development tool has firmly known to trade micro-loans awards for political support, often cemented itself into the imagination of many development resulting in the discrediting of microfinance as a trustworthy practitioners around the world. Despite some qualms about resource in the eyes of many families in poverty. The low and whether microfinance services have proven to be effective capped interest rates of microloans also create incentives for in combating poverty—and disagreement over how to even more corruption: public officials can use their clout to gain measure this effectiveness—the number of clients seems to be these loans for themselves and their organizations, making growing rapidly. services less available to the more-deserving poor. Those same The next major challenge for MFI practitioners is reaching capped interest rates can also lead to larger and larger loans— the regions where the critical mass of people in poverty exists: as people can afford to borrow more than they could with Mexico in Latin America, China and India in Asia, and higher interest rates—moving amounts away from what the most of Sub-Saharan Africa. Regardless of whether financial poor need and away from what they can handle. sustainability is the ultimate aim or not, a greater reduction of While one would think that subsidizing interest would per transaction costs will be crucial for the continued spread make loans more accessible to the poor, it appears that the of MFI services to these desperately poor areas. Where the practice could also, paradoxically put loans beyond their difference in cost between preparing a one hundred dollar reach. Yet consensus on this critique of subsidized interest loan and preparing a one hundred thousand dollar loan are 22 Bhumi negligible, but the difference in profit margins are huge, banks will have to get creative in finding ways to decrease the cost of preparation in order to reach more clients. Especially where the client population may be geographically diffuse and loans will tend to start out very small, the challenge of reining in transaction costs are even greater. Clearly, microfinance still has room to grow in order to become a more effective tool for alleviating poverty in the developing world—and it may never be the “magic bullet” some claim or expect. Questions remain regarding practice: how can we bring down transaction costs so low so that it is financially feasible to do business with a woman who wants a loan of 75 dollars? What of those who are not naturally entrepreneurial or those who are elderly or infirm? How do we reach those in the most rural areas? How can we collect and analyze better data to track the impact of microfinance services? These difficulties lie in the face of all the promise microfinance seems to offer. In spite of these and many other challenges, or perhaps because of them, MFI practitioners—many of whom have been bankers, business professionals, and lawyers earlier in life—seem to thrive on their work. I asked Michael Chu—one such thriving practitioner if there ever was one—why a young person might look forward to working in microfinance. He leaned back in his chair at HBS with a contemplative look in his eye, and paused. “I would be delighted if people looked at microfinance How can I get involved? Intern for Microfinance Organizations: Larger MFIs such as ACCION International based in Latin America www.accion.org, Opportunity International (www.grameen-info.opg) may be good places to start when looking for summer internships in this field. Also keep an eye out for medium—and smaller-sized MFIs such as ProMujer (www.promujer.org). Read up: There are various websites that provide information on microfinance from various perspectives. Microfinance Gateway at www.microfinancegateway.org is a website targeted towards microfinance practitioners primarily, but it may be a good place to locate MFI organizations. because—from a personal point of view—it’s one of the few things that I know that is an effective response to poverty. It’s developed extraordinarily fast. It will be a field that demands bright young people; it’ll be an intellectual challenge. And it’s work that will make them grow in every respect.” For the sake of Josefina Martinez and people like her, it might be something worth looking into. Peter C. D. Mulcahy ’07, a government concentrator living in Cabot, can be reached at mulcahy@fas.harvard.edu. Jeanette Park ’07, an economics concentrator living in Currier, can be reached at yjpark@fas.harvard.edu. How can microfinance reach regions such as rural China, where the critical mass of poverty still exists? Courtesy Tina Wang ‘07. Bhumi 23 The Developing World of Microfinance Irresistable Incentives Kyle Klopcic T hroughout its history, proponents of microfinance have had to wrestle with a question central to its institutional sustainability: what interest rates should be charged to borrowers? Microfinance institutions (MFI) that aim to be selfsustainable must charge interest rates that are high enough to cover operating expenses and the full cost of capital. At the same time, however, many MFIs also aim to lift their clients out of poverty—a goal that suggests that interest rates should be kept well below market rates so that loan recipients are not suffocated by debt. These two conflicting goals were mutually exclusive for the Nicaraguan MFI where I worked last summer, as it is for many MFIs. This organization had to make a choice—should it function as a self-sufficient, independent business, or as an NGO dependent upon a heavy influx of foreign aid? The firm for which I worked chose the latter option, arguing that lower interest rates were in the best interests of its clients. The difference between income and expenditures was covered by sizable contributions from American and Canadian development agencies. But this reliance on outside aid created a problem of accountability at my firm: I found that although my MFI’s actions were cloaked in the rhetoric of defending client welfare, the organization operated in fundamentally corrupt and irresponsible ways. My summer seemed to be framed by this theme. As part of my internship, for example, I received grant money to fund a project in which I created and distributed resource packets with basic financial management advice for the firm’s clients. When I approached my supervisor to withdraw money from the project account in order to make copies of the packet, my director gave me a sum of money significantly less than what should have been there. When I asked about the remainder of the money, the supervisor handed me receipts for gas that he had purchased for his car— receipts with dates from before I even arrived in the country! Even after accounting for all these expenditures, the sum was still less than what should have been left in the project account. When a similar experience occurred a couple days later with a separate grant, I began to question whether the missing funds were just isolated incidents involving mere accounting errors, or rather representative of the firm’s more pervasive problem with corruption. Unfortunately, my exposure to corruption was not limited to the microfinance institution where I worked. In Nicaragua, corruption was visible at virtually every level of government. The nation’s last president, Arnoldo Aleman, was convicted in 2003 of money laundering, embezzlement, and other corruption-related crimes. The mayor of the municipality where I lived had recently expropriated huge amounts of aid from the Japanese government that was intended to improve the city’s water-filtering system. Quite simply, the temptation to transfer donated funds from the recipient organization’s community projects to one’s personal account seems irresistable. When an individual struggles daily and is still only barely able to sustain himself and his family, he may come to see a few missing budget dollars as not only insignificant but potentially also morally justified. It is no wonder that the microfinance firm that I worked for chose to remain dependent upon foreign subsidies as opposed to opting for complete self-sustainability. The firm’s employees benefited from the corrupt practices. The consistent inflow of grants from abroad enabled the firm to claim that it was serving the best interests of the community by keeping interest payments to a minimum, even though it was diverting funds intended for the community to the firm’s leadership. Prior to my two-month stay in Nicaragua, I was too naïve to believe that corruption could exist within development agencies working to strengthen their communities. These agencies have ambitious, socially-driven mission statements, and I felt sure that their employees would be driven by a similar urge to fight for a greater good. I witnessed first-hand that even the most civic-minded individuals can act in their own interest when presented with incentives for corruption. Thus, until either a strong ethic against corruption is developed, or the systemic incentives for corruption are corrected, far too many donated dollars will fail to reach their intended recipients. Kyle, a junior in Eliot, is an economics concentrator. He can be reached at klopcic@fas.harvard.edu. What Work Remains to be Done? Do research on the impacts of microfinance at the individual and community levels. There has not been enough quantitative analysis of the effectiveness of microfinance. You can also identify development mechanisms that complement microfinance. It is important to think about ways in which microfinance can work in tandem with other development projects to bring about larger scale change. 24 Bhumi The Developing World of Microfinance Reaching the Poorest of the Poor Melissa Dell henever you are in doubt,… apply the first test. Recall the face of the poorest and weakest man whom you may have seen, and ask yourself if the step you contemplate is going to be any use to him. Will he gain anything from it? Will it restore him to a control over his own life and destiny? True development puts those first that society puts last.” - Mahatma Gandhi By this standard, the success of development in recent years has been, at best, moderate. According to 2001 World Bank Numbers, the annual per capita income of the U.S. is $30,600, as compared to $410 in developing countries. Half the world’s population lives on less than $2/day, 1.2 billion on less than $1/ day, and more than 29,000 children under the age of five die every day from preventable malnutrition and disease. Studies have shown that microfinance can be successful in lifting the very poor out of abject poverty. Yet, microfinance continues to primarily serve the “richer of the poor,” those who, while poor by US standards, are not amongst the poorest citizens in their respective countries. Perhaps the most common myth in microfinance is that it cannot be used to reach the very poor, because they are too costly and difficult to identify. Others have argued that even if microfinance can be used to reach the very poor, it will only leave them with an excessive debt burden, thereby making them worse off. Shahidur Khandker of The World Bank addressed these concerns in the most in-depth study ever conducted on microfinance. Khandker’s study indicates that approximately 10.4 million people leave extreme poverty each year as a result of microfinance programs. It also finds that microfinance reduces extreme poverty more than moderate poverty and has spillover effects that are helping the poor through redistribution and income growth. Despite these findings, common practices continue to operate on the assumption that microfinance cannot reach the poorest of entrepreneurs. Thus most funds go towards low-middle income borrowers who, while poor by US standards, do not live in abject poverty or even fall below the poverty line in their country. Because the very poor who have moved above earning $1/day are not involved in large-scale manufacturing or agriculture, they are oftentimes overlooked by macro economists and development “W institutions. However, microfinance can target these overlooked populations and where it has, lives are improving: in general, microfinance clients can eat better, send their children to school, receive better health care, and access clean drinking water. Millions of women are increasing their autonomy and self-respect. As the Microcredit Summit Report succinctly argues: “It cannot be stated any more plainly or urgently than this: when the myth [that microfinance cannot reach the very poor] dies, more children will live.” Why Does Microfinance Often Fail? One explanation is that international donors, largely ignoring the social impact of microfinance, often have stringent restrictions that MFIs achieve financial self-sustainability in the short-run. However, many highly successful MFIs, including those who have recently seen their funding cut, have not been able to do so in the time frame required by some development institutions. For those that have, typically 5% or less of their clients fall below the poverty line. Successful MFIs must become self-sustainable in the long run as their clients escape from poverty and build up a local savings base. However, whether or not they can become entirely self-sustainable without compromising their mission to serve the very poor in the short-to medium-term is unclear. Furthermore, few MFIs work in remote areas where the poorest of the poor live. MFIs often listen to clients, but fail to hear the voices of the most marginalized. Thus, their services are often not designed appropriately to reach the very poor. Client self-perception and intimidation also play a large role. As John De Wit, Managing Director of the Small Enterprise Fund in South Africa argues: “The poorer people see who goes to your program, and they just say, ‘This program is not for us; it is for those better off people.’ And then very often the wealthier people—maybe just the less poor—intimidate the poor, simply by saying, ‘This meeting is for serious people. Here we have to be serious about business. Somebody who is only selling a few vegetables is not serious about business.’…So, the presence of the non-poor unfortunately does scare away the poor.” Thus, it is important to specifically target microfinance services to the poorest of the poor. Bhumi 25 The Parliamentarians specifically asked the heads of these influential financial institutions that at least 50 percent of funds towards microfinance should reach the poorest clients, that costeffective poverty measurement tools should be implemented to ensure that targets are met, and that results should be reported annually. The fact that legislators in the developed world are beginning to Microfinance meetings such as these in Bolivia may scare away many of the poorest potential clients. take an interest in ensurMicrofinance, the Poor, and Politics ing that microfinance There has recently been a substantial move to ensure reaches the poorest of the poor is encouraging. Microfinance that institutions such as the U.S. Agency for International De- can play an important role in achieving the Millennium Goals velopment (USAID) target their funds towards the poorest by reducing poverty and vulnerability and empowering women of the poor, those living on less than $1/day. In June 2003, to access services such as healthcare and education. For as Sam President Bush signed into law a bill passed by unanimous Daley Harris, Director of the Microfinance Summit Campaign, consent in both the House and the Senate aimed at better en- rightfully states, only when we strive to bring microfinance to suring Congress’ long-standing commitment to dedicating half the very poor “will [we] truly be answering Gandhi’s call: ‘True of USAID’s microfinance funds to families that are very poor development puts those first that society puts last.’ when they start the program. Furthermore, hundreds of parliamentarians recently wrote Melissa Dell ’05 is an Economics concentrator in Winthrop. a letter to the heads of the World Bank, the Asian, African, and She spent a summer doing microfinance in Peru and later co-foundInter-American Development banks, and the United Nations ed A Drop in the Ocean, a non-profit microfinance organization. Development Program (UNDP) - institutions that spend less Next fall, she will study Economic and Social History at Oxford on than one percent of their budgets on microfinance. The letter a Rhodes Scholarship, and can be contacted at melissa.dell@trinity. encouraged these institutions to make providing microfinance oxford.ac.uk. Photograph by Don West for ACCION. for the poor a more important priority as a means for ensuring the achievement of the UN Millennium Goals. The following How can I get involved? is an excerpt from the letter: 1) Join A Drop in the Ocean (ADITO), a student group that as“What prompts us to write is a concern that sustainable sists microfinance organizations through fundraising and technimicrofinance for the very poor has not received sufficient priorcal support. See www.drop-in-the-ocean.org. 2) Get a summer internship in microfinance. OCS can help you ity in your policies and practice aimed at cutting absolute povget grants to cover your expenses, and ADITO and other stuerty in half by 2015, the most crucial—and most difficult—of dents and professors can help you find an organization to work the MDGs [Millennium Development Goals]. As important with. The results can be eye opening and life changing. as it is to support well designed health, education, and good 3) Attend regular events on Harvard’s campus sponsored by such organizations as ADITO, the Social Enterprise Club, and the governance programs, these interventions alone will not ensure Harvard Organization for International Development. that some 600 million people move out of poverty.” 26 Bhumi WorldView Bridging the River Ibar Sameer Narang ncircled by barbed-wire and packed with peacekeepers, the segregated town of Mitrovica in northern Kosovo lies physically and emotionally torn by the River Ibar. Kosovo Force (KFOR) troops stand guard on both sides of the bridge linking the town’s northern and southern banks, confining Serbs to the north and Albanians to the south, using tanks to barricade traffic in both directions. At first, it was difficult for me to accept: a bridge constructed to bring people together was now being used as an instrument of separation. Over time, however, I grew accustomed to the oxymoronic concept of a “dividing bridge,” for even in the simplest of ways, Kosovo was a world inverted, the reciprocal of all the ideas and concepts I had ever been taught. It was a place where bridges don’t connect, but rather, divide; where the unemployment rate isn’t 20 percent, but the employment rate is 20 percent. Even the metrics of space seemed different—my evening runs were no longer measured in miles, but rather in the number of villages, KFOR check- E points, and graveyards I passed along the dirt road carving its way through the surrounding hills. But Mitrovica wasn’t a hollow ghost town emptied out by the NATO bombing campaign. Instead, it was young and vibrant, buoyed by the uncompromising optimism of residents resolute in their refusal to relocate—an attitude not lost on the children. Despite threats from a handful of extremists, these courageous children were determined not to let the inertia of the past dictate their future, soaring and scoring their way toward mutual understanding in the multi-ethnic youth sports programs we struggled to create. It was a daily reminder that long-term reconstruction efforts—the offspring of intervention—would stagnate without enormous local and foreign investment of time and resources. Life in Mitrovica was made even more interesting because I was an American. The U.S.-led NATO bombing campaign against Serb aggression in 1999 meant that I was adored among Albanians and abhorred among Serbs—a combination The bridge separating the Serbian and Albanian sides of Mitrovica Bhumi 27 of warm embraces and angry faces. It was the first time in my life when I had been judged not by my character, but by the characters impressed on my passport. No matter how deferential or disrespectful, how caring or cruel, how interested or indifferent, I was always first and foremost an American—immediately reduced either to friend or enemy. The core of my experience in Kosovo, however, was my work. All of the images I saw and all of the people I met centered around my work with Sport Sans Frontieres, or Sports Without Borders. Although there were only a handful of us on the ground, the organization worked on several projects relating to sports and education. There were essentially two dimensions to the work. The first was bureaucratic—writing grant proposals and meeting with funders—while the second directly involved the children. Needless to say, I much preferred the latter. Working with children allowed me to meet hundreds of people and gave me a glimpse into the lives of a generation of children just a decade younger than me. Our main project was the creation of a multiethnic sports center, designed to bring together both Serbian and Albanian children. Besides the sports center, we also had ongoing projects in several neighborhoods throughout Mitrovica. We worked with both Serbian and Albanian children a few times per week using sport as a tool of education, but more importantly, as a tool of socialization. We organized multiethnic events, bringing children together around athletic activities and giving them the opportunity to play with children next to whom they once— pre-war—lived and attended school. When we organized a soccer tournament between an Albanian and Serbian neighborhood, it was the first time in over four years that many of the children had crossed the bridge. As a result of the symbolism of this seemingly simple sporting event, Serb extremists 28 Bhumi tried to sabotage the game by threatening Serb children. In an unfortunate display of the lack of trust between the two sides, KFOR peacekeepers guarded the field during the tournament. Despite the security afforded by the peacekeepers, turnout to our athletic events always depended on the level of general tension within the city. Facing resistance from all directions, it often seemed that the weight of the past was simply too strong to overcome. Parents of both Serbian and Albanian children were understandably reluctant to let their children play with kids from the other side of town. But as time passed—and as we spoke with parents on an individual basis—we slowly began to dismantle the barriers which have divided these children for so long. Some of our projects allowed us to work closely with local adults, training them to be coaches of the local youth and giving them the skills necessary to take ownership of the projects following our departure. This gave me a glimpse into the lives of Serbs and Albanians my own age and allowed me to hear their thoughts on everything from push-ups to politics. One of the most precious memories I have from Bosnia is of being a witness to an initial meeting between two of the local trainers with whom we worked closely, one Albanian and one Serbian. Separated by language, religion, ethnic conflict, and a river, these two men embraced each other before one of our tournaments. These two men, however, were the exception, not the rule. It was perhaps not until my last week in Kosovo that I realized the extent to which the situation in Kosovo had deteriorated. That was when the bubble burst. After having been there for weeks, feeling safer than ever, a bomb exploded a few hundred meters from where I had been living, exploding with it all illusions of security. Striking chaos into the silent night, sirens screamed as confused, half-asleep people ran directionless in the street. KFOR and United Nations police rushed to the scene, blocking off roads and trying to calm the family members of victims. The target was the main police station in the Albanian sector of the city. While the bomb was relatively small, it left one person dead and ten others injured. In the days after I left Mitrovica, the situation took a turn for the worse when a UN police officer was killed in an ambush as his vehicle slowed to a stop on the road winding its way out of the city. The following week, two Serbian teenagers were shot to death while swimming in the waters of the Ibar. As the summer wound down, hope for the region, both among local residents and internationals like myself, evaporated before my eyes. With the UN continuing to table the issue, Kosovo’s future political status remains uncertain. And so too do the futures of all the children with whom we worked. It is impossible for me not to wonder if bringing peace to the region is simply unachievable, like trying to solve an equation with too many unknowns. My final days were difficult. Everybody seemed to be fighting—not just the Serbs and Albanians, but different factions of Albanians against one another. It was a very important lesson, perhaps the most important lesson: in the spectrum of Kosovo, nothing is ever black and white. It is always gray, often stained with blood—blood shed over grievances about the past. The past hangs heavily in Kosovo. But in speaking with Serbs and Albanians, I soon realized that the past was nothing more than a series of conflicting narratives with varying degrees of historical traction. So it is a conflict rooted in ‘history,’ nurtured and reinforced by the wounds of the war, and growing greater with each day of uncertainty about the future. Ensuring that the next generation of Serb and Albanian children have a future—one in which they can peacefully live alongside one another—is the least we can do to help resolve this unrelenting conflict. Sameer Narang ‘05 is an applied math concentrator in Winthrop House. He went to Kosovo the summer of 2003 to volunteer with Sport Sans Frontieres. This NGO, which uses sports to connect youth divided by conflict, can be found at www.sportsansfrontieres. org. Photos were also taken by Sameer. Bhumi 29 WorldView A Tale of Two Festivals Melissa Dell hen we think of globalization, we often think of Americanization, bemoaning the commodification or loss of local cultural practices. International tourism has been particularly insidious, accused of not only devaluing culture, but also giving those in the developing world incentives to act out Western tourists’ misinformed stereotypes. The Masai in Africa, for instance, have become famous for dressing up in loincloths and pretending to be the tourists’ “primitive” ancestors. Because this exploitative influence of tourism fascinated me, I decided to study how tourism is affecting the celebration of two religious festivals in Cusco, Peru. Cusco, located high in Andean Peru, once served as the political and religious center of the Incan Empire. The first festival I studied here was Corpus Christi, a religious festival meaning “Body of Christ,” imported by the Spaniards soon after the Spanish Conquest. The second festival I studied was the Inti Raymi, or “Festival of the Sun” in Quechua. During pre-Conquest times, this festival served as the Incan commemoration of the winter solstice. Upon arrival, I was immediately awed by the atmosphere of Cusco, whose varied pasts revealed themselves everywhere in an intriguing and slightly bizarre mix of the indigenous and the European. In Pre-Columbian Cusco, for instance, the most sacred site in the city was a fortress called Saqsaywaman. After the Spanish Conquest, stones were taken from Saqsaywaman to construct the cathedral El Triunfo (The Triumph), which today is the center of Christian religious life. When passing through many of Cusco’s streets, I was surrounded by surviving Incan walls. Small children, anxious to earn a few centavos, showed me the many blemishes on the walls, where snakes and llamas originally carved out by the Incans had been erased by the Spanish colonizers. Clearly, Cusco is still the sacred center of Peru, a place in which imagined remembrances of the past continue to reappear and flourish, even as they clash with modernity. The festivals, too, proved to be a precarious mix of the native, colonial, and jarringly modern, highlighing Peru’s struggle to come to terms with its own identity, not only within an increasingly integrated global context, but in a domestic social context that remains disturbingly fragmented. 30 Bhumi W Corpus Christi and the Developed World Today, Corpus Christi remains an important devotional celebration for Peruvians, 90% of whom are Roman Catholic. Thus, I expected to learn the most about contemporary Peruvian society through Corpus Christi. Surprisingly, however, the experience taught me far more about how the developed world views Peru and its people. Corpus Christi is a Roman Catholic festival, infused with indigenous Andean elements, which continues to be a central element in the religious expression of Cusqueños. The festival consists of a procession of fifteen larger-than-life sized saints and virgins, accompanied by musicians, dancers spectacularly costumed in Andean regalia, and hundreds of faithful devo- Participants at the festival of Inti Raymi tees. Never have I seen such an outpouring of religious devotion as I did during the Corpus festivities. What surprised me most, however, was not the festival’s extravagance. Rather, it was the reactions of many of the international tourists. There were the standard, to be expected, grumblings about the traditional fare (granted, a cold plate of roasted guinea pig, chicken, and fried blood does not make the most palatable combination). But there were also what I found to be more troubling complaints. A backpacker standing next to me remarked: “I can’t believe people who are so poor would spend so much money for a festival. You’d think they would buy more chickens instead.” As one European ranted, “I can’t believe our government gives so much money to them when they spend their own on something as illusory as religion.” The grumblings would not surprise Peruvians, however, who seem to feel that their own government holds a similar attitude. Numerous Peruvians complained to me about the unpopular government of President Alejandro Toledo and his “technocratic” policies. One native Cusqueño argued that Toledo and his government were technocrats who only cared about the distant future—long term economic development and oil, specifically—at the cost of sacrificing expenditure for keeping the country’s rich cultural heritage alive. This led me to a series of questions: Who has the right to appropriate a cultural phenomenon? We in the developed world have so many opportunities for diversion. Why do we have a tendency to deny those who already have so few opportunities the legitimacy of enjoying themselves, especially through sacred expression? Should economic growth be emphasized above all else? If you don’t have running water or sewage in your house or if you can’t pay your child’s school fees, it is irresponsible to spend your money on a costume for a religious festival? And if so, do we who are more fortunate have an obligation to make sure that the basic needs of the less fortunate are met, with a small amount left over for occasional enjoyment or devotion? These comments opened my eyes to the shallowness that overtakes so much of the debate about globalization and development: in getting so lost in our drive towards economic growth, we often forget to ask the question, “To what end?” Inti Raymi and the Question of History Inti Rymi allowed me to probe even deeper into Peruvian social reality. No imagined remembrance could be more extravagant than the commercially-run Inti Raymi, in which thousands of participants recreate the singing, dancing, and sacrifices of the Incas within the spectacular Incan ruins at Saqsaywaman. The festival, the second largest in Latin America next to the Carnival in Rio, is planned by Cusco’s municipal tourist authorities, and the influx of tourists is massive. The main sponsors of the festival are Cerveza Cusqueña (a popular brand of beer) Coca-Cola, and a luxury hotel owner who traditionally plays the lead role. At first glance, it seemed to be a classic example of how multinational companies are transforming indigenous expression of the sacred into the equivalent of a futbol match. In a recent festival, the mayor of Cusco even mistakenly identified Inti Raymi as an Incan celebration of industry, with the potential for industrial development in Cusco serving as a screaming subtext. While a popular legend amongst Andean peasants holds that golden Incan objects might be found while digging in the countryside, it seemed as though the urban elite and multinational companies had found a far more effective way of cashing in on Incan treasure. Upon closer examination, however, subtle complexities were revealed. While multinational companies such as CocaCola do profit from the celebration, it is local elites and middle class merchants who profit the most. In fact, it is primarily Peruvian, not international, tourists who come to witness the festival. Surprisingly, most foreigners that I talked with saw Inti Raymi as inauthentic, a costume show for tourists. The Peruvian tourists, on the other hand, who were mostly wealthier mestizos from urban areas, saw the festival as an important part of their identity as Peruvians. Now of course, very few were unaware that the festival was a fabulous invention of tradition. After all, part of the ceremony consisted of play-sacrificing a stuffed llama that looked as though it could have come out of an FAO Schwartz catalogue. But despite all this, the Peruvians seemed to value this festival because it paid tribute to a past that was deliberately erased by the old Spanish rulers. People cannot exist without a history, and when theirs is stolen from them, they need to create a new one based on what memories remain. The result of this need is the creative exuberance exhibited in the Inti Raymi festivities. The festival reminded me of the Incan walls I had seen in Cusco where the original designs had been chiseled away, with only the scars remaining. Although parts of the Incan past were intentionally erased, for Peruvians, indigenous blood, like the Incan walls, is still all around—in their fellow Peruvians and often within themselves. To them, there is a glory in imagining the indigenous past, whose few surviving physical remnants, such as Machu Picchu and Saqsaywaman, where Bhumi 31 The Festival of Corpus Christi Inti Raymi is held, attest to remarkable ingenuity and strength. For urban Peruvian mestizos who are denied by social convention the possibility of expressing their indigenous heritage, Inti Raymi provides a single day to celebrate the Inca within, to revel in a past that their ancestors lived. For truly indigenous Peruvian peoples, who make up the most marginalized sector of the population, Inti Raymi’s impact is even more ambiguous. On the one hand, it appears that multinational firms are exploiting a local tradition for the sake of profit. On the other hand, Inti Raymi celebrates the pasts of the native peoples, and the ceremony, which is conducted in Quechua, provides one of the rare occasions where an indigenous language is used in a public forum. Furthermore, at Inti Raymi, it is the indigenous women, usually ignored, to whom everyone turns for interpretation of the ceremony. Many indigenous women who have small businesses selling refreshments and trinkets to tourists also benefit from Inti Raymi, albeit not as much as wealthier mestizo merchants. Further, most 32 Bhumi of the indigenous people in Cusco have been Christianized for generations, so the recreation of Inti Raymi is not a direct coopting of their religious beliefs for the sake of profits. It is not immediately obvious, then, that indigenous people are commercially exploited as a result of Inti Raymi. The question seems to be, above all: Who owns Inti Raymi, and who should have the right to profit from it? Many of the people I talked to argue that it belongs to all Peruvians, or to all who take an interest in the indigenous past. It seems inevitable that those who own the most resources in society will profit the most, and those who own these resources are predominantly the mestizo and Hispanic elite. A scheme by which the tax revenues earned from the tourist influx surrounding Inti Raymi could be used to provide social services or compensation to indigenous peoples seems conceivable. However, the roots of the problem, whereby non-indigenous peoples profit most off of indigenous culture, lie deep within the Peruvian social structure, a holdover, like the scars on the walls, of a colonial political institutions that have gone through few changes even since independence. On this day, the heavily popularized spectre of the multinational seems to dissolve into a more fundamental divide self-contained in Peru. My experience with the Inti Raymi caused a reorientation in my thinking about globalization. And with it came a new set of tough questions. Who is responsible for the commercialization of culture to begin with? Can we justifiably commodify cultures to save them? If so, who should benefit? Is culture worth saving at all? These questions are particularly relevant today, with the recent rise and now apparent retreat of neo-liberal politics in Latin America. They are pervasive and manifest themselves in many facets of Latin American life, including religious expression. And increasingly, they are questions that should not be pinned on “globalization” at large. If economic development is to bring a future that offers equal opportunities and freedoms for all Peruvians, they need to be addressed in the form of dialogue and negotiation between the Peruvian government and all its citizens, including indigenous Peruvians. Until indigenous people have access to wealth and social capital through participatory democracy, the situation seems unlikely to change. Melissa Dell ’05, an Economics concentrator in Winthrop, can be contacted at melissa.dell@trinity.oxford.ac.uk. Photographs were also taken by Melissa. Perspectives Between Development and Freedom Tina Wang Every decade or so, a central idea, catch-phrase, or supFurthermore, theorists are convinced that building good posed panacea emerges in the field of international develop- institutions and raising human capital are compatible with the ment. In the 1950s it was central planning and import sub- goals of increasing people’s “choice” and “freedom.” After all, stitution, in the 60s and 70s agricultural productivity, and in inadequate or absent participatory institutions and weak huthe 80s private markets and structural adjustment. Recently, man capital, such as education and civil society, often render development theory has put forth the ideas of “institutions” large sectors of the population powerless and voiceless in the and “human capital,” reflecting the shift in the focus of theo- face of the governing societal elite. But access to institutions rists away from investment in purely physical capital in favor and human capital often empowers the poor, providing them of strong, participatory institutions—political and economic with the capabilities of expression and assertion of their needs arrangements that purportedly allow for “voice”—and strong and interests. For instance, the reduction in deprivation of human capital, i.e. provisions of education, health, and basic capabilities, resulting from low life expectancy, malnourishfacilities. For leading development theorist Amartya Sen and ment, and illiteracy, logically increases people’s freedom, and many others, what is driving the demand for participatory their physical and intellectual capacity, to make choices. institutions and stronger human capital is the larger conceptual agenda of empowering individuals with choice and freedom. Underneath the motivations for advocating institutions and human capital is the assumption that participatory institutions, human capital, and the concept of freedom will all eventually converge, even though the strength of the linkages among them may be questionable. Recent development theory has decreed strong institutions and human capital as essential to economic development and growth. For instance, the 1997 World Bank Development report states that, “an effective state is vital for the provision of the goods and services—and the rules and institutions—that allow markets to flourish and people to lead healthier, happier lives.” Indeed the IMF, World Bank, and other international organizations, and academics alike, have come to explain any development result, which has deviated from the predictions of standard economic models, with the verdict of a lack of adequate “institutions” or of weak human capital in Democracy in progress: In an Ecuadorian village, neighbors vote at a local meeting. the developing country. Bhumi 33 Similarly, some theorists also reason that increasing people’s “freedom” and “choice” reinforces the development of good institutions and strong human capital. For example, the economist Dani Rodrik asserts that giving local people “voice” is the best way to gather knowledge of their circumstances and needs, thus allowing institutions to better serve them. Providing the poor with “voice” through elections or through choice given to local communities in implementing basic health provisions and other projects also ensures that institutions are more accountable, according to the World Bank 2004 Development report. Participation and choice, and good institutions and human capital are then reasonably mutually re-enforcing. Under scrutiny, though, the links between participatory arrangements and good institutions and human capital may not always be as strong as they initially appear to be. For instance, the historian Eric Hobsbawm argues that when leaders, who operate in arrangements that require the participation and expression of popular support from the people, seek to mobilize the masses for any project, they are frequently able to do so only by appealing to the traditional values that are often what keeps a large portion of society poor in the first place. And of course, if poverty increases, it can only lower the quality of institutions and the level of human capital. In his work Development as Freedom, Sen writes that “if a traditional way of life has to be sacrificed to escape grinding poverty or miniscule longevity…then it is the people directly involved who must have the opportunity to participate in deciding what should be chosen.” However, if the society, when given “choice,” chooses to keep the traditional way of life, that choice may subject many of its members to the very “grinding poverty” that results in weak human capital. Some academics seem confident that given freedom of choice, people in developing countries will make the “right” choices that further the development of institutions and human capital that logically empowers them. They may however choose to relinquish choice by choosing an authoritarian or religiously fundamentalist regime that then takes choice away from many people. The concept of development as freedom uses the seemingly neutral argument of “choice” as the goal of development to justify our belief in a democracy and a free market. Sen argues that people ought to have free choice, but the right choices are democracy and the free market, because elections and the threat of public criticism are incentives for democracies to do good and markets allow people to make choices without government interference. Is a regime or ar34 Bhumi rangement legitimate because people chose it or is it illegitimate because it results in taking away many people’s choices? Development theory’s current stress on human capital is valid indeed. Participatory government and socially inclusive growth requires a population with a measure of basic health and life expectancy as well as basic knowledge and education. Denying the opportunity of schooling to any group—say, female children—is immediately contrary to the basic conditions of participatory freedom. But if one values education for women, how will one choose between the education of women and allowing a country’s people to make a choice about which traditions to follow? Education of women is necessary for their participation in making choices, but state-sponsored education of women arguably takes choice away from the society, by forcing that society to unwillingly eschew tradition. The development economist William Easterly has written about how governments in developing countries sometimes force families to send their children to school, which arguably takes away choice from families but then equips children with education, preparing them to exercise their freedom in the future. Development theorists must decide whether they approve or disapprove of this use of state force, whether, in cases where freedom of “choice” and the value of human capital and institutions conflict, the former must prevail. Development theorists must no longer assume that provisions for “freedom” and “choice” will automatically lead to good institutions and stronger human capital. Giving people a measure of “choice” and “freedom” often carries judgments about what people should choose and what a free people should be like. In the coming decade, development theory, rather than conceiving of its development program in terms of building freedom or choice through institutions and human capital, should transparently present its concrete agenda for reducing the deprivation of human capabilities for the sake of improving the quality of life in developing countries. Tina Wang ‘07, a social studies concentrator living in Eliot, can be reached at tinawang@fas.harvard.edu. Photograph by Kathryn Berndtson. International Development Courses at Harvard Foreign Cultures 46 Historical Study A-15 Historical Study A-16 Historical Study A-23 Social Analysis 78 Freshman Seminar 46p Freshman Seminar 49e Anthropology 1790 Anthropology 2640 Anthropology 2680 Anthropology 2770 Economics 1312 Economics 1315 Economics 1320 Economics 1330 Economics 1340 Economics 1385 Economics 1386 Economics 1393 Economics 1535 Economics 1550 Economics 2325 Economics 2327 Economics 2390b Economics 2390c Government 90eo Government 90hh Government 90q Government 90qb Government 1100 Government 1197 History 2782 History 1890b Social Studies 98ax Social Studies 98gd Social Studies 98gh Social Studies 98eb Social Studies 98gj Social Studies 98gn Social Studies 98gq Sociology 206 Caribbean Societies Politics and Society in the Making of Modern India The Making of Modern South Asia Democracy, Development, and Equality in Mexico Globalization and Its Critics Human Rights Globalization: Critical Perspectives Violence in the Andes: Coca, Conflict, and Control Humanitarianism and Human Rights Globalization and Culture Development Dilemmas India in the Global Economy Economic Development in East Asia The Latin American Economy One Way or Many Globalization and History Introduction to Global Health and Population Health, Education and Development Poverty and Development International Trade and Investment Economics of International Financial Policy World Development Economic Development: Theory, Policy, Evidence Development Economics I: Microeconomic Issues Development Economics II: Growth Globalization and American Foreign Economic Policy Int’l Migration and Development US-Latin American Relations Int’l Human Rights and Law: Theory and Research Political Economy of Development The Political Economy of Africa The Economic History of Latin America The Economics of the Middle East Development and Modernization Human Rights: Current Issues in Theory and Practice Economic Development in Africa The Politics of International Trade Protest and Social Change in Latin America Poverty, Inequality, and Economic Policy The Global Culture Clash The Sociology of Development Matthias Maria Schündlen Adam Webb Martin K. Whyte Bhumi 35 Orlando Patterson Devesh Kapur Sugata Bose and Amartya Sen John H. Coatsworth M. Sandel and L. Summers Jennifer Leaning Adam Webb Kimberly Theidon Kimberly Theidon James L. Watson Pauline E. Peters Kaushik Basu Dwight H. Perkins Beatriz Armendariz R. B. Freeman and R. M. Unger Jeffrey G. Williamson David Bloom Erica Field and Michael Kremer Beatriz Armendariz Marc J. Melitz Jeffrey A. Frankel Jeffrey G. Williamson Dani Rodrik and Mark Rosenzweig Michael R. Kremer Philippe Aghion Thomas Oatley Devesh Kapur Jorge I. Domínguez Beth A. Simmons Devesh Kapur Robert Bates and James Robinson J. Coatsworth and J. Robinson E. Roger Owen Stephen A. Marglin Theodore Macdonald Matthias Schundeln Michael J. Hiscox Other Resources at Harvard Center for Business & Government at KSG: http://www.ksg.harvard.edu/cbg/programs.html The Center focuses on policy-oriented research on deregulation, information infrastructure policy, environmental economics, business involvement in education, and improving the performance of a market-driven economy while promoting public values and strengthening democratic institutions. The Center for International Development: http://www.cid.harvard.edu The Center for International Development (CID) serves as Harvard’s primary center for research on sustainable international development. Through research opportunities, seminars, mentoring relationships, and funding for travel the CID invests in the future of global economic development by offering resources to students who will one day be the world’s policy leaders. Undergraduates interested in studying international development may become involved with the CID through the Undergraduate Student Associates Program (see student groups). Center for Population and Development Studies: http://www.hsph.harvard.edu/hcpds/ The mission of the Center is to promote cross-disciplinary research on critical issues of population, health and development that will advance the well-being of the global poor. The Center’s activities are organized through faculty working groups, fellowship programs, seminars and courses, doctoral student research, and international workshops. Harvard Initiative on Global Health: www.globalhealth.harvard.edu The Harvard Initiative for Global Health seeks to create a new generation of leaders for global health and to develop new and innovative solutions to the vital problems of global health Hauser Center for Nonprofit Organizations: http://www.ksg.harvard.edu/hauser/ The Center offers a concentration in nonprofit organizations for degree-program students at the Kennedy School, and cooperates with the other schools to help create a comprehensive course of study available to students across the University. Office of International Programs: http://www.fas.harvard.edu/~oip/ The OIP serves as the central location for the coordination of in36 Bhumi Institutes and Centers formation and processes related to study abroad. Their aim is to help ensure that some type of international experience - whether study, research, or volunteer or paid work - is part of the education of every Harvard student. Weatherhead Center for International Affairs: http://www.wcfia.harvard.edu The Undergraduate Student Council organizes a Fall Open House, regional studies panels, and study groups. Summer travel grants are awarded to undergraduates who plan to conduct thesis research on topics related to the core interests of the Center. Undergraduates can also attend thesis workshops, receive independent project grants, and become assistants to members of the Fellows Program through the Undergraduate Research Associates program. Regional Centers Committee on African Studies: www.fas.harvard.edu/~cafrica The Committee on African Studies is a multidisciplinary group of scholars appointed to coordinate teaching and research on Africa. It sponsors lectures, conferences, films, exhibitions, and offers summer travel grants for senior honors thesis study and graduate dissertation. The Asia Center: www.fas.harvard.edu/~asiactr The Asia Center hosts lectures, seminars, workshops and conferences, senior academic and government delegations, and provides fellowship and grant assistance for undergraduate and graduate students and faculty in Asia related fields. The Program on Central Asia and the Caucasus: www.centasia.fas.harvard.edu The Program on Central Asia and the Caucasus supports the interdisciplinary study at Harvard of all of Central Asia. For students interested in development in Central Asia, the Program offers the opportunity for students to participate in courses, collaborative research, and seminars. Fairbank Center for East Asian Research: www.fas.harvard.edu/~fairbank In addition to a series of ongoing workshops and seminars, the Fairbank Center sponsors annual conferences, lectures, and staffs an extensive library on East Asia. The center also offers travel grants, research grants, and essay prizes for undergraduates. The David Rockefeller Center for Latin American Studies: http://www.fas.harvard.edu/~drclas The DRCLAS has worked to increase understanding of the affairs of Latin America and related fields such as Iberian and Latino studies. For undergraduates, the Center facilitates summer internship opportunities abroad, offers term-time and summer employment, and participation in the Student Advisory Board. The Davis Center for Russian and Eurasian Studies: http://daviscenter.fas.harvard.edu/ The Davis Center for Russian and Eurasian Studies is Harvard’s center for interdisciplinary research and study of Russia and the countries surrounding it. Undergraduate students may apply for research travel grants and participate in the annual Undergraduate Colloquium on Russian and Eurasian Studies. Harvard International Relations Council: www.harvardirc.org The Harvard International Relations Council serves as the umbrella organization for five programs, all designed to promote international awareness and education: Model United Nations, Harvard International Review, Harvard Program for International Education, Harvard Intercollegiate Model United Nations, and Model Security Council. Harvard AIDS Coalition: http://www.uniteagainstaids.org/ The Harvard AIDS Coalition (HAC) is the founding chapter of the Student Global AIDS Campaign (SGAC), an international student network of AIDS activists striving for an end to the global pandemic. Harvard Project for Asian and International Relations: www.hpair.org The Harvard Project for Asian and International Relations (HPAIR) organizes an annual conference at a rotating site in Asia that brings together university students from around the world to discuss critical issues of the region. Harvard Public Service Network: http://www.fas.harvard.edu/~pbh/psn/ HPSN offers a wide range of public service-related resources for all students interested in issues such as urban poverty, disaster relief, affordable housing, environmental quality, and more. Harvard-Radcliffe Friends of the American Red Cross: http://hcs.harvard.edu/~redcross/ Friends of the American Red Cross is a volunteer organization through which students and affiliates of Harvard assist in and learn about the public service and public awareness functions of the American Red Cross. Social Enterprise Club: www.hcs.harvard.edu/~sec The Social Enterprise Club (SEC) was founded to promote awareness about the dynamic and fast-growing field of Social Entrepreneurship by engaging undergrads in thinking about new and innovative solutions to generate powerful answers to society’s problems domestically and internationally. Students of Operation Smile (SOS): www.hcs.harvard.edu/~hrsos SOS is a group dedicated to alleviating the medical needs of children who live in third world countries and have physical deformities. Bhumi 37 A Drop In The Ocean (ADITO): http://www.drop-in-the-ocean.org/ The mission of this group is to support micro-finance programs for women, children, and very poor in developing countries, especially Peru. Harvard College International Development Organization (HCIDO): http://www.freewebs.com/hcido/ The Harvard International Development Organization (HIDO) promotes on-campus awareness of international development issues and contributes funds and research to international NGO’s through a system of 4 substantive working groups on Education, Human Rights, Health, Micro-finance and 3 logistical working groups on awareness, fundraising, and public relations. Harvard Friends of Amnesty International: www.hcs.harvard.edu/~amnesty/ Harvard Friends of Amnesty International is an organization that campaigns to promote all the human rights enshrined in the Universal Declaration of Human Rights and other international standards. Harvard Association Cultivating Inter-American Democracy: www.hcs.harvard.edu/~haciadem/ HACIA Democracy was founded to create an educational government simulation that focused on domestic and international issues in the Americas. The Harvard staff works together with host country schools and institutions to plan the Summit of the Americas conference. Student Groups Resources in the Greater Boston Area Grassroots International www.grassrootsonline.org/ Grassroots International promotes global justice through partnerships with local organizations in developing countries. They work to advance political, economic and social rights and support economic growth and development through grant distribution, education, and advocacy for these partners. United Nations Association of Greater Boston http://www.unagb.org/ The United Nations Association of Greater Boston seeks to increase public awareness of the value and work of the United Nations and to build public understanding of and support for the fundamental concepts of the United Nations: multilateralism and international cooperation. International Institute for Justice and Development www.iijd.org/ International Institute for Justice and Development is an international, non-partisan, consulting, charitable, and educational corporation specializing in Justice and Development issues. IIJD’s activities support initiatives to meet the health, educational, and nutritional needs of the poorest communities in the world. Boston Network for International Development www.bu.edu/dbin/polisci/ The Boston Network on International Development is a nonprofit organization which puts individuals and groups into contact with one another through a website comprised of event postings, internships, and contact information for organizations and persons involved in international development. Oxfam www.oxfamamerica.org Oxfam America is a Boston-based international development and relief agency affiliate of Oxfam International. Working with the Boston community, Oxfam organizes development programs, emergency relief services, and campaigns for change in global practices and policies that keep people in poverty. Partners in Health www.pih.org/index.html Partners in Health strives to bring the benefits of modern medical science to those most in need of them. They draw on the resources of the world’s elite medical and academic institutions and on the living experiences of the world’s poorest and sickest communities. 38 Bhumi CARE www.careusa.org/ CARE works with the poorest communities in more than 70 countries around the world to find lasting solutions to poverty. They promote global responsibility and innovative solutions to complex problems by drawing from global diversity, resources and experience. Cultural Survival www.cs.org Cultural Survival is a non-profit organization dedicated to promoting rights, voices, and visions of indigenous peoples throughout the world. They have committee groups dedicated to topics of conflict and migration, culture, health, indigenous enterprise, law and self-determination, and conservation of natural resources. John Snow International http://www.johnsnow.org/ JSI’s goal is to build local capacity to address critical health problems. Through management assistance, research and evaluation, education, and training, JSI works to improve access to and quality of health care to prevent illness and disease. WorldTeach www.worldteach.org/ WorldTeach is a non-profit, non-governmental organization based at the Center for International Development at Harvard University which provides opportunities for individuals to make a meaningful contribution to international education by living and working as volunteer teachers in developing countries. World Education www.worlded.org/ World Education works to meet the needs of the educationally disadvantaged by providing training and technical assistance in informal education. Registered as a private voluntary organization, World Education has worked in over 50 countries in Asia, Africa, and Latin America, as well as in the United States. Northeast Universities Development Consortium http://www.hec.ca/neudc2004/about.html NEUDC is a major forum in development economics. The location and sponsorship of the annual NEUDC conference usually rotates among the organizing institutions: Boston University, Cornell University, Harvard University, Williams College and Yale University. JOIN THE FIGHT FOR INTERNATIONAL DEVELOPMENT. Harvard College International Development Organization VISIT WWW.FREEWEBS.COM/HCIDO TO LEARN MORE! turley printing ad on bottom half of page Bhumi 39 BHUMI: Make the Committment 40 Bhumi