Questioning

[Guest]

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[suzb]

Doesn't global capitalism create and enforce poverty and inequities?

Why does reproducing it on a small scale really challenge the status quo?  Capital remains with us, the wealthy, when it is repaid.  The literature maintains use microcredit to meet basic daily needs.  What is wrong with aid to redress the immoral exploitation capitalism encourages?

I'm questioning Kiva, with 7 years of experience in the field, it seems like a way we can all feel happy looking at the picture of the 'african' we helped, while going about our daily lives consuming more and exploiting others.

[nfolkert]

No.

[Julia]

The capital doesn't remain with us. The entrepreneurs use our capital to create their own capital.  And, they get to continue to use our capital, the businesses will continue to take out loans as they expand, just as they do in the 'developed world'.

I personally know that credit can build wealth. I have gone from being rather poor to fairly well off thanks to credit given to me for my education and house, and my credit has allowed me to take advantage of a lot of opportunities.

I started a hobby business on credit that is now self-sufficient, but would not have made it if I didn't have access to capital. I couldn't even have gotten a merchant account to accept credit cards without credit.  I have seen other similar businesses fail because the proprietor did not have access to capital.   Or only had access through credit cards at very high rates.

Western society functions based on credit.  I betcha almost every person reading this post has at least one current outstanding loan (even if its to a credit card that hasn't been billed yet).  I know I live in a house the bank owns part of.

[michael]

Doesn't global capitalism create and enforce poverty and inequities?

Yes, capitalism by definition entails some who have more than others, whether through the fruits of their own labor, through inheritance, or through leveraged investment and savings.  Without apology, I believe in capitalism.  But I also believe that it is the responsibility of those with more to assist those with less.  You can consider this enlightened self-interest, pacification of the masses, or applied trickle-down economics.  In the end, my motivation doesn't really matter, as long as I am actually helping others.

Why does reproducing it on a small scale really challenge the status quo?  Capital remains with us, the wealthy, when it is repaid.  

Just as I only have one vote in this republic, I only have the ability to help a few people.  My limited ability does not decrease my responsibility, or my desire.

The literature maintains use (sic) microcredit to meet basic daily needs.  

If they do, they do.  But your next statement about using aid instead of loans would not change this.

What is wrong with aid to redress the immoral exploitation capitalism encourages?

Aid has its use and its place.  But it has no leverage - once given, it is gone.  With a microloan, I can help many people over time with the same money as it gets repaid.  

I fail to understand your apparent problem with an agreement between an individual seeking a loan with a promise of repayment and a lender willing to provide the capital.  As for the immoral exploitation bullet you fired there, I can't speak to that.  I do not find it immoral to live in my country and work for a living and provide for my family with my earnings.  If I am exploited as a worker, so be it.  If my government or this economic system is exploiting others, my lending money to those in need does not make the situation worse.

I'm questioning Kiva, with 7 years of experience in the field, it seems like a way we can all feel happy looking at the picture of the 'african' we helped, while going about our daily lives consuming more and exploiting others.

Your arrogant presumption here would bother me if I in any way doubted my own motives.  But I know that I am now and will continue to make loans not from my excess but from my needed funds.  I am neither debt free nor well off.  And I do not for one moment regard these borrowers as zoo exhibits or tools to soothe my conscience.   I am content with what Kiva is doing and my small part in it.

Clearly you have other ways, other paths that you use to make the world a better place.  Kiva is one of many I choose to use.  May you be as happy with the path you have chosen as I am with mine.

Peace,

michael

[RichardF]

suzb,

I'd love to hear about your ideas on how to eliminate poverty, inequities and  immoral exploitation, particularly in terms of how you intend to contribute to making these ideas reality.

[multimutts]

Doesn't global capitalism create and enforce poverty and inequities?

No, I don't believe that.  I don't believe that capitalism creates poverty, I believe that it provides a way out of poverty. 

Why does reproducing it on a small scale really challenge the status quo?  Capital remains with us, the wealthy, when it is repaid. 

Have you read the journals?  The 'status quo' of poverty is being changed.  Maybe not eliminated, but certainly changed and real people's lives are being improved.

Will the capital "remain" with me once it is repaid?  Maybe ... or maybe it will be used to loan again, and give someone else a 'hand up' in acquiring their own capital. 

I am not "the wealthy".  I am very ordinary; and in my life I have had the benefit of receiving loans which provided my education, which provide my car, my home, and sometimes even my 'play things' ... like the computer I'm typing this message on right now.   I have been, and will likely always be, in debt to someone ... for something .... and I'm very lucky to have had someone (friend, family or bank) there when I needed the helping hand. 

That's part of the reason that it is the right thing to do to take notice of people like me .... ordinary people, living their lives in their own societies, but who need a helping hand to get started .... and these people aren't as lucky as I was ... in my view, that is where the 'poverty' comes from .... the fact that they lack the resources of monies that I was able to find when I needed to.   

So that's where something like Kiva is useful .... that is why it is the right thing to do.   

We couldn't think more differently from one another.

The literature maintains use microcredit to meet basic daily needs.  What is wrong with aid to redress the immoral exploitation capitalism encourages?

 

There is nothing wrong with providing aid.  There is nothing immoral about providing a loan either.

I'm questioning Kiva, with 7 years of experience in the field, it seems like a way we can all feel happy looking at the picture of the 'african' we helped, while going about our daily lives consuming more and exploiting others.

While I respect your experience, I cannot buy into the idea that I should feel guilty about taking part in Kiva.   

You do not know me .... and it is wrong ..... immoral (to use a phrase familiar to you) ... to suggest that I am using my participation as a lender to Kiva as a 'crutch' to justify a lifestyle of exploitation and pillaging. 

I do not exploit others .... and I have seen no evidence in the posts here that *anyone* is present only to satisfy a guilt-ridden ego. 

You may have your views concerning the efficacy of these loans in alleviating poverty .... and it is fine with me if you have honestly evaluated the system and can explain a better way.  Perfectly fine, and I invite the discussion. 

It is not "fine" for my involvement, or the sincere involvement of others here, to be held up as an object of ridicule and a supposed symptom of our collective immoral natures.   

That is not fine, and I do take offense.

patti

[Ramón]

This post beg for an answer

First of all, I am not at all insulted by the fact that this question is being asked. It's a good question, as in many cases, the form of capitalism that has been pervasive in the Third World, actually has maintained and increased poverty. And this geneally means that the few, already rich and the large foreign multinationals could become even richer over the backs of the poor workers. It's a problem that exists, and that both capitalism and socialism attempt to resolve.

To me, socialism cannot and has proven not to be able to solve poverty. The main issue with redistribution of wealth is that it disencentives the economic productive people to become more productive and at the same time it doesn't incentive less economically productive people to become more productive. As a result, overall wealth will decrease. Not good.

Micro financing does allow for poor people to become economically more productive, see some of the responses that were given before.

Is this all that needs to be done? No, definitely not. Micro financing doesn't address the need for good schooling, health care, infrastructure, good governance, etc. It also doesn't address the unfair inequality of the current system that is caused by unfair economic practices in these countries. Though... If the overall economic participation goes up, wages will go up, and living conditions will improve.

The question to me is not so much if Kiva and micro finance is the right thing to do, but more: "what else can I do?"

To give you some hints:
- if you buy goods from the third world, were they produced fairly?
- global warming will affect poor countries lots more than rich countries. What do you do to lower your overall energy consumption?

I can go on like this... But let's leave that for later.

Ramón

[dgandhi]

Doesn't global capitalism create and enforce poverty and inequities?

I agree that it does. Kiva is not "THE ANSWER".

Why does reproducing it on a small scale really challenge the status quo?  Capital remains with us, the wealthy, when it is repaid.  The literature maintains use microcredit to meet basic daily needs.  What is wrong with aid to redress the immoral exploitation capitalism encourages?

Here I think you are basically correct, with the MFIs lending out money at %37, it's hard to take the possition that we are giving people a fair shake as we as members of the propertied(though working)class would expect to, and usually do, recieve.

That being said I think that this is in many ways a BETTER (maybe not even good, but better) place to put money.

The folks reciving the loans "benefit" in that they would be worse off otherwise (with 80-800% interest), the MFIs (which pay local staff and finance local infrastructure) clearly profit from our free captol infusion.

I would rather do this than put the money in a bank in the US, where it goes to fund all sorts of things I take acception with. That is simply pragmatic, I live in a capitalist culture. I have currency to puchase lifes neccesities, and I have "surplus", but no reasonable way to use it that radically addresses the problem outside of my own country, and I think most importantly, to do so in a non-imperialist manner.

I'm questioning Kiva, with 7 years of experience in the field, it seems like a way we can all feel happy looking at the picture of the 'african' we helped, while going about our daily lives consuming more and exploiting others.

I think that this is true, Kiva markets itself to the liberal left who want a feel good solution, and they provide it. While I think that this strategy may be counterproductive in the long run we are still faced with the current state of world capitalism, people still expect to be paid, and not charged too much. Kiva pays in warm fuzzies, and people want those warm fuzzies badly, even to the extent that they don't want to collect interest on the loans(which I think would be at least consistent with how the loan system is set up, and would get a lot more resources circling through the "third world")

While I think Kiva is okay, I don't see that any non-radical solution will have a better effect, and I don't see most of the people on Kiva jumping on board with revolution any time soon.

On the whole I think Kiva is "mostly harmless"

[Wood Fairy Glenda]

     So far, I've only responded directly to the person who started this discussion.  dgandhi's contribution has prompted this comment from me.
     
     I am one of those do-gooder liberals you disparage who doesn't want to get interest on my "investments."  That is because to me, they are not investments at all.  They are gifts, and better yet, gifts that can be recycled to other needy people around the world when each is returned.  I have arranged things so that any money I put into KIVA loans will neither end up in my pocketbook nor in those of my heirs.  And, yes, my payment for these gifts is "feeling good." Is there really anything so terribly immoral about this attitude? I think not.
     
     I am a 66-yr-old widow.  When my husband died of cancer, I made a conscious decision to do all I could in my remaining years to make the world a better place and to try to live my one life for both of us.  My feeling is that to the extent that I am able to better the world I am honoring the person I loved most.  As corny as it may seem to you, I feel that KIVA loans are one of many ways I have to do this. 

     I have more money than I need, though I am by no means a rich person.  My children will not need all that I have.  Other people in the world have much less money than they need.  I am very happy to be able to use my excess money to equalize things a little bit. It's as simple as that.
     
     That being said, I have to agree that the interest charged to poor people around the world by the microlending organizations seems exorbitant to me, though it may be that the risk involved necessitates it.  I would like to see the very minimum interest charged that would still allow the microlending organizations to stay in business.
     
     I think that KIVA could help to make this happen by adding one more piece of information to their blurbs about their lending partners:  namely, the amount of interest charged to the borrowers.  That way we, the lenders, could use the information to help in our decisions as to which borrowers to support.  It is especially important in such countries as Kenya, where there are multiple microlender groups.
     
     

[cpbailey]

If Aid were the solution, then welfare would have solved poverty in the U.S.  I believe that a loan encourages people to strive for their goals AND maintain dignity.  Sometimes aid does more damage than good; food may be delivered, and then farmers lose their market.  Then the area can no longer support itself. 

Just ask anyone with a payday loan if $500 for a month would change things...

I like that I can give the same money over and over.  There is little overhead compared to much aid or charities, too.  I learn a lot about countries, customs and politics from Kiva.  A simple check to the Red Cross doesn't have the same connection.