Westport, Conn.

Tom Flynn’s letter about Robert Grossman’s fine cartoon picturing Barack Obama playing the triangle among other celebrating Democrats [“Letters,” Jan. 1] really rubbed me the wrong way. Flynn thinks that of all instruments, the triangle is “the most trivial one of all.”

So I called my friend Billy Ware, who plays triangle professionally for the great Cajun and Zydeco band Beausoleil. Billy told me, “The triangle is humble with great musical virtue. It is also a fantastic groove machine.” He mentioned that while European in origin, the triangle is featured prominently in Brazilian music. Billy also told me that Don Montucet, the premier triangle artisan in south Louisiana, made his triangles from the iron tines of a hay rake before agricultural technology changed. After skillfully bending the iron into a triangular shape, Don would curl the ends of the iron. This gives the iron triangle a lower and richer resonance than the steel orchestral triangle used in, say, the Pittsburgh Symphony Orchestra.

So, listen here. Don’t trivialize the triangle! It’s humble. It’s virtuous. And completely cool in the hands of Barack Obama.

CHRIS FRANTZ Talking Heads & Tom Tom Club

LAND AIDS OR BAND-AIDS?

New York City

Alexander Cockburn doesn’t appreciate what the Grameen Bank has accomplished [“The Myth of Microloans,” Nov. 6]. Through its uncollateralized loans, the bank has helped millions of villagers acquire livestock, land and other assets, as well as half a billion dollars in savings. The bank has helped 650,000 villagers purchase homes, all of which must be legally registered in the wife’s name. The bank is also owned by villagers, who elect nine of twelve positions on its board of directors. These changes are deeply subversive–which is why the bank has been harassed by the Bangladeshi government and been a target of opposition and violence from landowners, moneylenders, Muslim fundamentalists and socialists alike.

With loans millions of villagers have acquired such things as a tin roof, a vegetable garden and proper bedding and crockery, and have achieved year-round food stability. Many have also been able to send daughters to school. Cockburn should not dismiss advances like these; they make a big difference in people’s lives. Moreover, deeper changes may be taking root. In the most recent national elections in Bangladesh, more women voted than men, and 18 percent of those elected to Union Parishad posts were members of the Grameen Bank or BRAC, the two largest microcredit programs.

Cockburn contends that the bank “places” its borrowers in debt. This is wrong. The bank would not have remained popular among villagers for more than twenty years if it were coercing or intimidating them. Poor people are not fools. When I interviewed Grameen borrowers who had faced cyclones and floods, they told me clearly that the bank was the key factor in their recovery. Without loans, they could not have repurchased assets to get back to work.

Microcredit is not a “neoliberal” or romantic idea. And nobody calls it a panacea. It is a valuable option that should be made widely available to the poor, along with many other options. Cockburn is right to argue for macro-level reforms. But villagers need reliable, respectful institutions like the Grameen Bank to help them with their daily struggles.

DAVID BORNSTEIN Author, The Price of a Dream:The Story of the Grameen Bank

Andhra Pradesh, India

Microloans cannot remove extensive poverty, but they have been a huge success. “Band-Aids,” as Alexander Cockburn calls them, prevent immediate spread of infection. These stopgaps give people the chance to live and go the extra mile (“radical land reformers” know this). Cockburn disparages “Band-Aids” but also admits radicals get bullets in their heads. Inability to change the world doesn’t mean inability to change your part of the world–and this is what Muhammad Yunus is doing. Microloans have prevented suicides. Mass suicides did not exist fifteen years ago. Corrupt governments, banks and agencies forced farmers to take loans and buy exorbitant supplies. Debts rose from 1,000 to 2,000 rupees to 75,000 to 100,000. Poor farmers borrowed from other poor farmers, who earned money laboring in cities. When the borrower committed suicide, his financier lost everything. Microloans help people think small initially. A decent buffalo and insurance can be bought for $130 through NGOs, which don’t take cuts. Yunus and radicals fight the same evil. Don’t run down Yunus. We have seen what microloans do, especially for women in the Third World.

NANDITA SEN Village Reconstruction Organization

New York City

As co-founder and executive director of Pro Mujer, a sixteen-year-old women’s development and microfinance network that provides credit and training to 150,000 women in Latin America, I agree there is no quick fix for poverty; microfinance is not a panacea. It does not relieve governments of responsibility for providing health and educational services to citizens, nor is it a substitute for investments that yield jobs, benefits and a stable income. However, in the absence of adequate public services and private-sector investment, microloans go a long way toward helping women (the primary users of microfinance) to create their own jobs in the informal sector and improve the quality of life for themselves and their families.

Even greater benefits are possible depending on the microfinance institutions’s (MFI) delivery system. For example, Pro Mujer organizes women in groups that meet weekly or biweekly to borrow and repay their loans. We link all clients with health services and negotiate affordable rates with quality providers. The overall impact of having a social support system, additional income and primary healthcare is profound but hard to quantify.

Pro Mujer has established five MFIs. Our interest rates are indeed higher than commercial banks, as it is costly to administer small loans and provide human development services (our average loan is $200). We consider ourselves a development organization that employs microfinance as a means to empower women, whose repayment rate is more than 99 percent and who use their additional income to keep their kids healthy and in school. There are many types of MFIs, from commercial banks to NGOs. As microfinance comes to be seen as a potential investment, it is important to stay true to the real bottom line: helping poor people improve their lives.

LYNNE PATTERSON

COCKBURN REPLIES

Petrolia, Calif.

Let’s first go to the basic question: Why microloans for poor people and macro-handouts for the rich? Is it that the poor just can’t handle the excitement of getting a decent loan? In her letter, Lynne Patterson says it all: “microfinance is not a panacea. It does not relieve governments of responsibility for providing health and educational services to citizens, nor is it a substitute for investments that yield jobs, benefits and a stable income.” So maybe give the Nobel Peace Prize to someone with a better idea than Yunus, who’s a very appropriate hero for neoliberals.

I said that microloans can help, but that the hype is completely out of hand, as two of these letters attest. Take the claim that microloans have slowed farmer suicides. This is disgusting nonsense. The largest number of suicides have occurred in Andhra Pradesh, in regions thick with groups involved in such loans. Indeed, Andhra probably has more microloan groups than any other part of India. The largest and most important newspaper of Andhra Pradesh, Eenadu, has reported more than once on cases of people who have committed suicide precisely because of harassment by microcredit groups.

Last March the press in Andhra Pradesh reported that its government was contemplating “severe action” against some MFIs because they were charging exorbitant interest rates and harassing the local population. They “have become worse than moneylenders,” was the terse description of AP’s chief minister, Rajasekhara Reddy. He went on: “We were told that these MFIs are charging exorbitant interest rates of 15 per cent to 20 per cent flat, amounting to 30-40 per cent interest. They are said to be resorting to highly unethical recovery measures.” One of his colleagues appealed to the commercial banks to deliver rural women from the predations of the microfinanciers.

Many of the self-help groups that practice this microcredit are now being used by banks as loan recovery squads. In Kerala it’s led to clashes. A few weeks ago, the Reserve Bank of India cheerfully and explicitly called for such groups to be used in bill collection and loan recovery. Imagine the social tensions and clashes the microfinanciers are setting up in a village when your neighbor pries into your house for debt recovery. It’s already happened.

Microloans do not pay off the kind of debts that farming runs up. The average microloan in Andhra Pradesh does not equal the cost of cultivation of one acre of cotton anywhere in that state. Nor does it equal a tenth of the cost of one acre of land in most of these places.

The “decent buffalo” invoked by NGO bureaucrat Nandita Sen comes at indecent prices. Right now in the state of Maharashtra, plagued with a hideous wave of farmer suicides, cows and buffaloes under the government program are selling for more than 15,000 rupees (about $350). Even if these cows are highly subsidized, the farmer still has to pay at least 5,500 rupees. But it’s not just a matter of the initial price of the beast. If Sen looked up from grant applications and asked a starving farmer about that decent buffalo, the farmer would say that people are desperate to return animals that are eating more than their families. Cows cost between 120 and 150 rupees a day in feed, more than twice the minimum wage under India’s rural employment guarantee program for human beings. And much of the government’s activity on this cow front was slated to run through self-help groups, who then gouge the farmer for the repayment with interest. It’s a racket.

The hype about Grameen itself comes in zeppelin-sized increments. The late Daniel Pearl and Michael Phillipps did a long piece on the Grameen Bank in the Wall Street Journal a few years ago that poked a pretty sharp stick through the balloon, on such substantive matters as loan repayment rates and debtor dissatisfaction. To say it once more: Microloans have helped. As a tool for bettering the long-term situation of the rural poor, they’re a dud.

ALEXANDER COCKBURN