Shabbir Chy/Sayeed Quazi reply to AMITECH Grameen Bank article
Naeem Mohaiemen
Posted on behalf of Shabbir Chowdhury & Sayeed Quazi who do not have
access to SCB.
Date: Thu, 12 Jun 1997 15:10:40 -0400
From: Sayeed Quazi x3695 <qsa...@lucent.com>
Subject: RE: AMITECH: GRameen Bank & Myth of Development (fwd)
The Grameen Bank, Microcredit and the Myth of Development
By Taj ul-Islam Hashmi
Since President and Hillary Clinton,Queen Sofia of Spain and her sister
along
with
scores of Western political figures,journalists,intellectuals and others
have
been
eulogising the achievements of the Grameen Bank of Bangladesh as "The
Solution" to Third World poverty,and President Clinton is said to have
felt
that
Professor Yunus,the founder of the bank,should be awarded the Nobel
Prize,it
has
become an extremely difficult task for anyone to undermine the
achievements of
the bank,let alone reject it as an outright hoax or as a tool of
exploitation
of the
poor in the name of "alleviation of poverty".
+++++++++
Question - Does the author want to declare Grameen Bank " as an
outright hoax or as a tool of exploitation of thepoor in the name of
"alleviation of poverty"?"
The frequent usage of the phrase
"alleviate poverty" by the supporters of the bank is reminiscent of how
Indira
Gandhi used her favourite phrase,"Gharibi Hatao",conveying the same
meaning.
One wonders,while Indira Gandhi with the help of government machinery
and
support of the people simply failed to kick out the demon called
poverty, how
on
earth the NGOs and the Grameen Bank would achieve their goal! At the
outset
one may pose the question to the protagonists of microcredit scheme that
had
microcredit been the answer to poverty,how countries like Japan, Korea,
Singapore,Taiwan and Malaysia for example,have alleviated poverty and
developed without introducing nation-wide microcredit scheme.
+++++++++
The critical point here is the "government." I would like the author
to show the similarities between governments of Japan, ...Malaysia with
those from countries like Bangladesh, India.
Without citing scores of economists and social scientists who have
shattered the myth of
microcredit,singling out it as the promoter of a vicious circle of debt,
entrapping the poor for ever like a deadly spider,one may appraise the
situation
vis-a-vis poverty and microcredit scheme in Bangladesh, with special
reference to the
Grameen Bank.
++++++++++
Please site the references with proof of "... vicious circle of
debt,entrapping the poor for ever like a deadly spider."
By any standard it is a great achievement. Professor Yunus and others
working for the bank should be congratulated for their
achievements.
+++++++++++
Isn't that contradictory with respect to the opening comments that "as
an outright hoax or as a tool of exploitation of thepoor... "
This,however, does not mean that one should buy the argument,
given quite frequently by Professor Yunus, that "credit is a human
right....If
credit
can be accepted as a human right,then all other human rights will be
easier to
establish," because as we know, neither an indebted person nor an
indebted
nation
connotes a state of prosperity and independence.
++++++++++++
Why not? Please explain! Dr. Yunus is taking about credit not
donation to provide for food, housing, and medical care.
It has been argued by the Grameen lobby that since two million villagers
of
Bangladesh (94% of them women)have borrowed from the bank to attain some
subsistence through cattle and goat rearing, small poultry farms,paddy
husking,bamboo work and other subsistence-oriented traditional means of
livelihood, brave new worlds have been opened up for the poor in
Bangladesh.One knows, these traditional,labour-intensive, low-profit
generating and often uncertain means of livelihood are simply keeping
poor women
entrapped in such home-centred drudgery which is more in favour of the
status
quo than a breakthrough for female emancipation.
++++++++++++
Is the author suggesting that there should be some grandiose scheme of
poverty alleviation? Is there any such thing out there? Could he
please show how that would work under the prevailing socio-economic
structure of Bangladesh?
Again, as a recent empirical study has shown, most credit extended to
women
are actually taken by men, women remaining the surrogate borrowers.
+++++++++++++
Please explain what the author means by "empirical study?" Is he
stating a fact, theorem, hypothesis or what? (I cannot help but to say
that this ridiculous! The danger of a sentence like this that if you
take out the first part it sounds like you are talking a fact.)
Even if we accept that 94 per cent of the borrowers are women, no
feminist or libertarian
would be happy with the explana- tion why women are preferred to men as
clients by the bank.
+++++++++++++
Has the author talked with "feminist or libertarian" or guessing? Does
the author really think that feminist or libertarian would go to women
who are borrowing money from Grameen Bank and tell them they should not
do that because it is gender biased? (Was this comment meant for comic
relief?)
So far as the issue of lending money without collateral is concerned,
the
Grameen Bank is not the pioneer in this regard. Indian banks, after
nationalization
under Indira Gandhi in 1969, also advanced collateral-free loans to
Indian
villagers. One may cite the Pathan moneylenders(or Kabulis) in this
regard as well.They also
used to lend collateral-free small amounts to people in this region and
in
general, their rate of interest was around 24 per cent per year or two
per cent per
month.
+++++++++++
Is the author comparing Pathan (or Kabulis) moneylender to India's and
Grameen Bank's efforts just because they are collateral-free?
There was, again, no dearth of borrowers among the poor.There was,
again, no sign of "consequential" prosperity among the indebted people
either.Professor Yunus is again proven wrong because credit did not lead
to prosperity.
+++++++++++
So just because Indira Gandhi's effort failed (and please don't even
think of suggesting that Kabulis wanted to alleviate poverty of the
people by lending money) how could one concludes that "Professor Yunus
is again proven wrong because credit did not lead to prosperity?"
+++++++++++
Please explain the term "again" in this sentence. What other things
were "proven" wrong earlier in the article?
Another important aspect of the rural credit mechanism in Bangladesh
must not
be lost sight of with regard to collateral-free loans- about 80 per cent
poor
villagers have local sources of short-term collateral-free, and most
importantly,
interest-free emergency loans from their neighbours and relatives,
especially when
someone is ill or there is a wedding or bereavement in the family.
++++++++++++
Author's point?
Although many critics of the Grameen Bank have pointed out that by
preferring
women to men as borrowers, the bank has been accentuating the
fragmentation of
the society by deepening the division between overwhelmingly dominant
men
and exceedingly weak women in a patriarchal and strife-ridden peasant
society
like Bangladesh,
++++++++++++
How can empowering the women can widen the gap between "overwhelmingly
dominant men
and exceedingly weak women?" Please (please) help us understand the
logic.
One may, however, raise the question: Are poor Bangladeshi women zoo
animals or
objects of curiosity for the rich and powerful of the developed "First
World"?
++++++++++++
Does the author really think that comments by President (about noble
prize) and Mrs. Clinton, Queen Sophia raise the above comparison?
Of late, many local and international observers have raised doubts about
the
viability of the bank and its benefits.Some scholars believe that the
demand
constraints of primary products in the event of more and more people
joining
the bank,undertaking similar production activities, producing milk,egg
and
poultry,for example, in the impoverished countryside of Bangladesh where
more than 50
per cent of the population live below absolute poverty line, would make
such
enterprises non-viable.
+++++++++
Didn't the author say earlier that the percentage of people borrowing
money is low? Why does he worry now that it will lead to
over-production?
One wonders, while a recent study on Dhaka city alone ......
+++++++++
Key words Grameen Bank and Dhaka City. (OK, if he does not know the
meaning of Grameen - "village" or "country-side")
In view of the above, one may agree with Muslehuddin Ahmed who thinks
that
"despite the considerable efforts of Grameen Bank,BRAC and some other
NGOs,there has been no appreciable improvement in the general poverty
situation in Bangladesh"["Microcredit from micro- sources",
Holiday,April
l4,1997].
++++++++++
No, One may not!
Last but not least,what one feels that:
b) unaccountable NGOs' growing influence and their attempts to weaken
government machinery and the structure of the state are heinous acts of
sedition and are ominous signs for the welfare of Bangladesh-weak
governments and
strong NGOs have nowhere led to prosperity;
+++++++++++
"heinous acts of sedition?" Comm'on give us a break! (another comic
relief?)
d) it is high time that we should point out how in the name of
eradicating
poverty NGOs like BRAC and Grameen Bank have been helping the rich and
powerful by
exploiting the poor-one may point out in this regard that BRAC run
Aarong ,for
example, charges 6000 taka for an embroidered sari while the poor
village
womanwho does the embroidery, gets about 300 taka;
++++++++++++
This is an example of BRAC exploiting poor people by using Aarong. Can
this be the basis for same conclusion with respect to Grameen Bank?
Our salvation,in short, does not lie at the hands of the gennie of the
Aladdin's lamp (being rubbed by the Grameen-NGO lobby) but in a
concerted effort to establish the rule of law,corruption-free
and accountable government of the people.
+++++++++++
"rule of law,corruption-free and accountable government of the people"
- that's it? That's all we need to alleviate poverty?
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Comments from Shabbir Choudhury, ex student secretary, BCP, ex
faculty, BIT, and currently in doctoral program in PSU Industrial
Engineering.
---------- Forwarded message ----------
Date: Thu, 12 Jun 1997 13:08:15 -0400 (EDT)
From: Shabbir A. Choudhuri <sha...@tool.ie.psu.edu>
Subject: Re: AMITECH: GRameen Bank & Myth of Development (fwd)
> ==============================================================
>
> Since President and Hillary Clinton,Queen Sofia of Spain and her sister along
> with ......... ,...........
> become an extremely difficult task for anyone to undermine the achievements of
> the bank,let alone reject it as an outright hoax or as a tool of exploitation
>
NO CONTENT
> the poor for ever like a deadly spider,one may appraise the situation
> vis-a-vis
> poverty and microcredit scheme in Bangladesh, with special reference to the
> Grameen Bank.
>
IDIOTIC LOGIC
> given quite frequently by Professor Yunus, that "credit is a human right....If
> credit
> can be accepted as a human right,then all other human rights will be easier to
> establish," because as we know, neither an indebted person nor an indebted
> nation
> connotes a state of prosperity and independence.
>
MORE IDIOTIC
> livelihood, brave new worlds have been opened up for the poor in
> Bangladesh.One knows, these traditional,labour-intensive, low-profit
> generating
> and often uncertain means of livelihood are simply keeping poor women
> entrapped in such home-centred drudgery which is more in favour of the status
> quo than a breakthrough for female emancipation.
>
PROVIDE THEM WITH HIGH-TECH, HI PROFIT LIVELIHOOD, OTHERWISE STOP
NONSENCE
> actually taken by men, women remaining the surrogate borrowers.Even if we
> accept that 94 per cent of the borrowers are women, no feminist or libertarian
> would be happy with the explana- tion why women are preferred to men as
> by the bank.According to some Grameen Bank officers, this is so because women
> are passive, submissive, they cannot run away with money and most
> importantly,their vulnerable honour or izzat assures the bank "an unwritten
> guarantee" of getting back the loan-money as a woman's failure to repay her
> loan
>
WHAT DO U SUGGEST? DON'T LEND TO WOMEN? IF THE RECOVERY PROCESS
WORKS BETTER FOR WOMEN BORROWER (whatever the social reason is, IZZAT!)
LET IT BE LIKE THIS FOR A WHILE. WHILE YOU MENTION SUBMISSIVE, IZZAT
ETC. SOUNDS LIKE GRAMEEN BANK OFFICERS ARE GOING TO RAPE THEM.
>
> So far as the issue of lending money without collateral is concerned, the
> Grameen
> Bank is not the pioneer in this regard. Indian banks, after nationalization
> under
> Indira Gandhi in 1969, also advanced collateral-free loans to Indian
> villagers. One
> may cite the Pathan moneylenders(or Kabulis) in this regard as well.They also
> used to lend collateral-free small amounts to people in this region and in
> Yunus is again proven wrong because credit did not lead to prosperity.
>
OOOOHH! WHAT A COMPARISON. JEALOUSY!!!
>
> Although many critics of the Grameen Bank have pointed out that by preferring
> women to men as borrowers, the bank has been accentuating the fragmentation of
> the society by deepening the division between overwhelmingly dominant men
> and exceedingly weak women in a patriarchal and strife-ridden peasant society
> like
> Bangladesh,Prof Yunus simply denies that the bank has further widened the
> gender-gap in the countryside.There is possibly some truth in the assertion
> that
> male-female conflicts have been mystifying the wider causes of the class
> conflicts
> inherent in this inegalitarian society.One should realise the long-term
> consequences of ignoring poor men as "petty criminals" and "touts",as done by
> the
> Grameen Bank and many NGOs engaged in microcredit operations throughout
> Bangladesh.
>
THINK ABOUT SHORT TERM. NOBODY SAID THAT THE SYSTEM OF MICROCREDIT
FOR WOMEN IS GONNA BE THERE TILL KAL HASHOR.
>
> Anotherr story is about Queen Sofia and her sister who visited some villages
> in
> Bangladesh. The queen is said to have relished the warm and sweetened glass of
> milk and date-sugar (khejurer gur),offered by a village woman. So far so good!
> One
> may, however, raise the question: Are poor Bangladeshi women zoo animals or
> objects of curiosity for the rich and powerful of the developed "First World"?
>
WHAT DO YOU MEAN? STOP BULLSHIT. THEY ARE NOT ZOO ANIMAL, WORSE.
SINCE THE ZOO ANIMALS HAVE GUARANTEE OF FOOD, SHELTER AND TREATMENT.
SEEMS LIKE YOUR IZZAT! IS MORE VULNARABLE THAN GRAMEEN WOMEN. AMAR
PONDHE'R GHA DOCTOR DEKHLE MOHA SORBONAS!
> What has always been missing in Professor Yunus's and other Grameen
> supporters' speeches is how borrowers who fail to maintain regular weekly
> payments of loan-instalments for various reasons " are forced to sit on their
> bare
> feet on a mud floor for several hours until all instalments are collected";
>
I WOULD LIKE TO HAVE THEM NIKE FOOT, CARPETED ROOM TO WORK ON.
TELL ME HOW?
> group-members take defaulters' saleable household items,jewelleries and
> livestock and sell them out to collect loan-instalments.What Grameen fans do
> not
>
SOMETIMES YOU HAVE TO BE HARSH TO MAKE THE SYSTEM WORK. THERE
SHOULD BE SOME MECHANISM TO DISTINGUISH THE DEFAULTERS IN CATEGORIES.
>
> One may cite David Bornstein (another Western admirer of the Grameen
> .. ... ....
> who borrowed 3500 taka from the bank to buy a cow which stopped lactating
> aftersix months,leaving her owing 1700 taka to the bank.As under Grameen Bank
> rules, the cow could not be sold until the loan was repaid, Aleya had to work
> in
> the houses of wealthier villagers and cut down on the family's eating and put
> everyone in the family,including her seven-year-old daughter, to work to repay
> her loan-instalments[The Price of a Dream, UPL,Dhaka 1996,pp.149-51].Aleya's
> case
> most definitely does not strengthen the microcredit thesis that Grameen Bank
> has
> been alleviating poverty, let alone the eradication of it.
FINALLY SHE PAID BACK AND BECAME THE OWNER OF A COW WHICH COULD BE
A DREAM FOR GENERATIONS. DON"T SHOW YOUR "DOROD" FOR SEVEN YEAR KID
WORKING FOR LIVING. SOUNDS LIKE AMERICAN HUMANIST DEMANDING BAN
ON BANGLADESHI GARMENTS EXPORT BECAUSE OF CHILD LABOR. YOU GUYS
SUGGEST THAT LET THOSE CHILDREN DIE BUT DON"T LET THEM WORK -
BECAUSE OF YOUR FUCKED UP CIVILIZATION"S IZZAT.
>
> may well imagine the situation of the poor borrower whose cow,for example,is
> stolen or dies suddenly.In view of the above, the scenario one would imagine
> is
> that: the poorest of the poor simply cannot afford to borrow from the Grameen
> Bank or any other microcredit organization and start repaying the loan-
> instalments from week one.This means, only those with enough subsistence and
> alternative sources of income (or credit) to repay loan-instalments without
> any
> hardship, are the actual "beneficiaries" of microcredit scheme of the bank
> (albeit at
> a very high rate of interest).
>
NO MODEL IS PERFECT LIKE KORAN SHARIF. LET IT WORK AND FIGURE OUT
THE LOOP HOLES. DON"T CITE EXCEPTIONS AS THE DEFAULT CASE.
> Of late, many local and international observers have raised doubts about the
> viability of the bank and its benefits.Some scholars believe that the demand
> constraints of primary products in the event of more and more people joining
> the
> bank,undertaking similar production activities, producing milk,egg and
> poultry,
> for example, in the impoverished countryside of Bangladesh where more than 50
> per cent of the population live below absolute poverty line, would make such
> enterprises non-viable.These projects, on the other hand,would benefit rich
> urban
> consumers due to the over-production of dairy products,eggs, fish and
> handicraft
> by the poor rural producers.
>
AGAIN LAME EXCUSES. DO U THINK WE ARE CLOSE TO SURPLUS IN THE PRODUCTS
LIKE MILK, EGG ETC. WHEN WE WILL BE CLOSE TO THAT THE BORROWERS
WILL SHIFT TO SOMETHING ELSE.
> per day. One very pertinent question in this regard is: Had microcredit been
> that
> successful in alleviating poverty, why on earth, hundreds of thousands of poor
> Bangladeshis have been going overseas to work as labourers by selling off
> their
> properties? Had 3000 taka (the price of a reasonably good pair of leather
> shoes in
> Bangladesh) been good enough to alleviate poverty, only stupids would have
> spent more than 100,000 taka per head to go abroad to work as labourers in
> very
> harsh conditions.
>
STUPID!!!! WHO? THE PEOPLE WHO ARE GOING ABROAD ARE NOT THE
TARGET GROUP (EXCEPTIONS ARE THERE). WHO TOLD U THAT ONLY 10,000
IS ENOUGH FOR GETTING A "LABORER's JOB" IN FOREIGN COUNTRY? EVEN
IF IT IS 10,000, THE PEOPLE WHO CAN MANAGE THIS SUM (BY SELLING
PROPERTY INCLUDING IZZAT) ARE AS RICH AS BILL GATES IN COMPARISON
TO MOST MICROCREDIT BORROWERS.
> Since this critique is not an attempt to totally demolish the concept of
> microcredit
> as a temporary measure to help the poor,one has no reason to ignore the fact
> that
> the Grameen Bank has attracted at least two million poor villagers in
> Bangladesh
> in over 36,000 villages and maintaining a recovery rate of over 98 per
> cent,especially in a country where nothing seems to work efficiently and where
> rich borrowers simply do not repay their bank loans.This, however, does not
> mean
> that microcredit schemes alone would lead to the overall development of a
> country like Bangladesh.As one American observer has recently pointed out that
> although the American Red Cross has been rendering a great service to the
> nation,one cannot say that it alone would be enough for the overall sustenance
> of
> the nation.This comment was made in regard to the hyperbolic claims made by
> people in support of the Grameen Bank.
YOU SOUNDS LITTLE POSITIVE HERE. NO BODY SAID MICROCREDIT ALONE
WILL MAKE THIS WORLD BEHEST.
> a)any attempt to "empower"only the poor women by ignoring the poor men,
> would lead to gender-war and further fragmentation of the society;
WHAT DO U MEAN!!!!!
> b) unaccountable NGOs' growing influence and their attempts to weaken
> government machinery and the structure of the state are heinous acts of
> sedition
> and are ominous signs for the welfare of Bangladesh-weak governments and
> strong NGOs have nowhere led to prosperity;
CONTROL THE THINGS. IT IS BETTER TO BREAKDOWN THE FUCKEN GOVT.
MACHINERY.
> c) NGOs and Grameen Bank cannot perform miracles through microcredit
> schemes- men and women,urban and rural,rich and poor,educated and
> illiterate-everybody will have to work for achieving "miracles" like those of
> the
> "dragons" and "tigers" of the Asia-Pacific region;
AS I MENTIONED EARLIER. MICROCREDIT IS NOT "SHEYALER TEL", THAT IT
WILL CURE EVERYTHING FROM CANCER TO DHOZOBHONGO.
> d) it is high time that we should point out how in the name of eradicating
> poverty
> NGOs like BRAC and Grameen Bank have been helping the rich and powerful by
> exploiting the poor-one may point out in this regard that BRAC run Aarong ,for
> example, charges 6000 taka for an embroidered sari while the poor village
> woman
> who does the embroidery, gets about 300 taka;
>
AT LEAST GETTING 300. OBVIOUSLY I WILL APPRECIATE IF THEY GET
A BIGGER SHARE. BUT DON"T SAY THAT SOLUTION IS TO DEMOLISH
THE MICROCREDIT GIVER.
> e)one may raise the question, if the bulk of government servants and
> politicians
> are corrupt (one does not deny this),what guarantee we have that those who run
> the NGOs,Grameen Bank and other microcredit organizations are honest and
> incorruptible.
>
NO BODY IS CLAIMING THEY ARE FERESTA. BUT SOMEHOW THEIR ORGANIZATIONAL
SUCESS SHOWS THAT THE MECHANISM IS WORKING IN THEIR OWN WAY
WHETHER YOU LIKE IT OR NOT.
> In sum,NGOs and microcredit alone cannot eradicate poverty but provide some
> subsistence to the poor and one knows,attaining subsis- tence and eradication
> of
> poverty are not the same things.Had microcredit been successful, in the last
YEEEEEEEEEEEESSSSSSSS!
> years it would have covered the entire population of Bangladesh. Since the
> Grameen Bank has taken 20 years to cover two million people (and all of them
> have not become rich) how many 20 years it would take to cover the entire
> population? And even if the entire population is covered by microcredit scheme
> of the Grameen Bank, for example,would that be good enough to classify
> Bangladesh as a developed country? Our salvation,in short, does not lie at the
> hands of the gennie of the Aladdin's lamp (being rubbed by the Grameen-NGO
> lobby) but in a concerted effort to establish the rule of law,corruption-free
> and
> accountable government of the people.
>
WITH ALL DUE HONOR, TELL ME HOW TO GET THOSE THINGS. COME UP
WITH A COMPREHENSIVE DOABLE LIST OF WORK. PLEASE, I MEANT
"DOABLE", DON"T GIVE ME THEORY OF RELATIVITY, GAUSSIAN PROBABILITY,
HEGEL'S MATERIALISM etc. etc. YOU DIGEST THOSE THINGS GIVE ME
A MODEL DO..., IF.....ELSE KIND OS THINGS.
ANJAN