A prominent psychiatrist had argued that the categorization of depressive disorders should include symptoms of sadness after the loss of a loved one even after just a few weeks. While the DSM taskforce rejected the proposal, controversies such these are becoming more common as diagnostic categories have come to encompass less severe symptoms and normal “problems in living.”

Likely to appear in DSM-5 is a new depression diagnosis called “Mixed Anxiety/Depression,” combining symptoms of anxiety and depression, and “Pre-menstrual Dysphoric Disorder” (PMDD), which includes the monthly symptoms like fatigue, sadness, and bloating that most women experience.

Who really benefits from these expanded diagnostic criteria? In their 2007 book The Loss of Sadness, sociologist Allan Horwitz of Rutgers University and co-author Jerry Wakefield suggested that depressive disorder increasingly encompasses “normal sadness.” Horwitz warns that the trend of expanding diagnostic criteria is “creating a massive amount of pathology without [offering] corresponding benefits to those who truly need treatment.”

Though patients who could not afford, or would not have been offered, treatment may receive it, as less severe problems become part of disorder categories and are potentially covered by health insurance, psychiatrists and other mental health professionals will be able to treat more people than ever before.

Psychiatry will reap the rewards as the field claims more authority over everyday problems. As those with less severe symptoms will be targeted for new and existing medications, pharmaceutical companies will certainly gain. Antidepressants are already the most prescribed drugs in the US; their use may expand even more.

Journalist Thomas B. Edsall, in his new book, The Age of Austerity, argues that a zero-sum politics has taken hold as Democrats and Republicans scramble to maintain their share of what they see as a shrinking economic pie. Neither side, however, presents themselves as the “party of the rich” or the “party of the poor”; both claim to represent the middle class.

The vast majority of Americans count themselves as middle class. While today’s imagined class boundaries fall along occupational, regional, and (most importantly) racial lines, what remains consistent is an “us”— comprised of the moral middle class — and a “them”— comprised of the morally inferior rich and morally inferior poor (which may include disloyal or naïve members of the middle class, as well).

For many Americans, class is a moral identity. Americans tend to believe that the poor deserve their fate, and that the rich do not deserve their wealth. They superimpose the moral order of the lazy, the hardworking, and the greedy onto the poor, middle class, and rich.

As long as Americans sort their fellow citizens into moral categories, we’re unlikely to see class struggle in any Marxist sense. But that doesn’t mean we won’t hear the term “class war” used repeatedly from now until November.

Though the overwhelming majority of the total population of the United States reported only one race, among those who reported multiple races, White and Black formed the largest multiple-race combination. Native Hawaiians, Other Pacific Islanders, American Indians, and Alaska Natives were more likely than other racial groups to report multiple races. People who identified as White were the most likely to report only one race. Hispanics identified themselves predominately as either White or “some other race,” comprising 97 percent of those identifying with the latter category.

Since 2000, growth in the Hispanic population has been mostly due to birth and immigration; for Asians it was due, in large part, to higher levels of immigration relative to other groups. The Black population, the second-largest racial group, experienced growth over the decade, but at a slower rate than all other race groups except for White.

Several features in this issue focus on the ways in which intimate life choices and experiences are shaped by economics and power. In our cover story, Sharmila Rudrappa follows women in Bangalore as they transition from the brutal conditions of work in the garment industry to another form of assembly line production: baby making. For these women, the intimate use of the body as a means of earning a living is not only a more lucrative form of labor, it is also at times more lucrative form of labor, it is also at times more self-fulfilling. Julia A. Ericksen explores bodily intimacy in an entirely different milieu, the world of Latin dance. The “body project” these dancers engage in demonstrates the interplay Irvine reports on a recent survey of sexuality researchers and their experiences with Institutional Review Boards. Her evidence suggests troubling trends in the ways that IRBs evaluate the ethics of sexuality research based on uninformed and negative stereotypes of sexuality and the body. Each of these feature articles invites further discussion on the shifting role of bodies and intimacy as forms of self-awareness and social capital.

The Viewpoints symposium in this issue continues the theme of intimate inequalities with a focus on Occupy Wall Street. In this dynamic movement, activists are literally using their bodies as a vehicle of protest as they move onto the sites of occupation. We asked several well-known social analysts to comment on this innovative form of embodied social protest and to speculate on its implications.

Pedagogies editor Gary K. Perry reflects on the disruption of intimate lives that occurred in the aftermath of Hurricane Katrina. He interviews Michael Mizell-Nelson, founder of the Hurricane Digital Memory Bank. The survival experiences stored in the HDMB began as a way for concerned friends and families to communicate with one another in the days immediately following the hurricane, and now serve as powerful reminders of the scope of this disaster and its impact on the everyday lives of the socio-economically disadvantaged. This theme is also evident in Mediations and Trends, which include commentary on the stark distinction between media images of “the help” and the lived experiences of domestic workers; the sexualization of pre-teens in contemporary media; sleeping on the couches of strangers as a popular new mode of travel; and the contested role of animal testing in medical research. Finally, our photo essay explores the nooks and crannies of the infamous military prison at Guantanamo Bay. These pictures provide a behind-the-scenes look into the environment in which the inhabitants spend their days.

This issue provides fresh perspectives and new insights for deciphering intimate inequalities as they occur locally, nationally and globally, in contexts of survival, pleasure, research, imprisonment and more. We invite you delve in for a deeper, richer understanding of social issues — the hallmark of Contexts.

According to the latest Census, the number of people living to age 90 and beyond has tripled in the past three decades — to almost 2 million — and is likely to quadruple by 2050. And 70 percent of
nonagenarians are female.

Studying the gender gap in aging, sociologist Meika Loe, in >Aging Our Way: Lessons for Living from 85 and Beyond, says that women may have a leg up when it comes to managing self-care in old age. Skills like cooking, cleaning, and caring for others clearly impact the ability to care for oneself.

In addition, nonagenarians maintain autonomy and control by asking others for help, which may be easier for women to do. But asking also requires good social networks. These tend to shrink as people age.

To counteract this problem, Loe shows how some elders have begun creating “informal care villages”— neighbor-helping-neighbor volunteer systems that allow individuals to share local resources at a cost savings or exchange personal services for free. They might trade driving or transportation for emotional support, for instance, or take turns delivering hot meals or checking in on one another.

Only 22 percent of elders live in institutional facilities. Forty percent of those 85 and older live by themselves. Informal care villages enable interdependence and actually increase elders’ ability to remain independent. They ensure that elders’ needs continue to be met, especially in a climate of limited federal support for aging at home.

It turns out that traditionally female skills, like asking for help, make a huge difference in the aging process. Men: take note.

by Gabriela Molina (gabrielamolina.com)

Robin I. M. Dunbar, an evolutionary anthropologist and primate behavior specialist, addresses this question in a neuro-cognitive theory known as “the social brain hypothesis.” Dunbar has found a positive correlation between the size of different primate species’ neocortex (the part of the brain responsible for consciousness and reasoning) and the size of their social networks.

He suggests that the brain has a limited capacity for keeping track of social relations beyond a certain number. For humans, the mean number, he says, is 150—now known as “Dunbar’s number.”

The average internet user who “follows” individuals on Twitter, “friends” people on Facebook, and gets “LinkedIn” with other professionals, “knows” many people. According to the June 2011 report by the Pew Internet & American Life Project, the average American social network site user has 636 social ties, and those numbers are only going up. Nielsen Media Research reports an increase from 2010 to 2011 in social networking activity in every internet-connected demographic group studied, around the globe.

By pushing our cognitive limits, Dunbar’s theory suggests, social ties may become more diffuse; social relationships may grow increasingly casual and less bounded by reciprocity and commitment.

Some sociologists say there’s little cause for alarm. Writing in the British Journal of Psychology last year, Barry Wellman, a leading authority in social network analysis, suggests that human social networks are too complex and comprised of too many kinds of social relations to be characterized by one number. It is also possible that our brains may further develop to accommodate these enlarged networks.

Or we may succumb to Facebook fatigue, cancel our accounts and return to more “personalized” modes of interaction.

“Yet here I am today. I carried those twin babies for nine months and gave them up.” Living in the southern Indian city of Bangalore, married at 18, and with two young children of her own, she had delivered twins a month earlier for a Tamil couple in the United States.

I met Indirani when she was still pregnant and living in a dormitory run by Creative Options Trust for Women, Bangalore’s only surrogacy agency at the time. COTW works with infertility specialists who rely on the Trust to recruit, house, care for, and monitor surrogate mothers for their clients. Straight and gay couples arrive from all over India and throughout the world to avail themselves of Bangalore’s expertise in building biological families. Indirani and other mothers introduced me to 70 other surrogates they had gotten to know through their line of work. Some of them, including Indirani herself, double as recruiting agents, bringing new laborers into Bangalore’s reproductive assembly line.

India is emerging as a key site for transnational surrogacy, with industry profits projected to reach $6 billion in the next few years, according to the Indian Council for Medical Research. In 2007, the Oprah show featured Dr. Nayna Patel in the central Indian town of Anand, Gujarat, who was harnessing the bodies of rural Gujarati women to produce babies for American couples. Subsequent newspaper articles and TV shows, as well as blogs by users of surrogacy, popularized the nation as a surrogacy destination for couples from the United States, United States, England, Israel, Australia and to a lesser extent Italy, Germany, and Japan.

A mother shows a photograph of her surrogate baby with his biological father (right), next to her own husband and child (left). Photo by Sanjit Das (sanjitdas.com)

Indirani’s life typifies that of other women in Bangalore’s garment factories. Paid low wages, she works intermittently in one of the city’s many garment factories. She quit when she became pregnant, and joined the line again when her two children attended school, taking time away when she was sick, or to care for sick family members. Bangalore’s reproduction industry affords women like her the possibility of extracting greater value from their bodies once they have been deemed unproductive workers in garment factories. Because of its life affirming character, Indiriani and others see surrogacy, however exploitative, as a more meaningful and creative option than factory work.

Disposable Workers

The popular understanding is that women who have large debt burdens and are destitute opt to become surrogate mothers. But while they are in debt, the 70 mothers I met were not among the poorest in Bangalore. Many were part of dual or multiple income households, and tended to be garment workers who earn more than the average working woman in the city.

Photo by Sanjit Das (sanjitdas.com)

Like garment workers in sweatshops across the world, women in Bangalore are underpaid and overworked. In order to meet short production cycles set by global market demands, they work at an inhumanely fast pace, with few or no breaks. They frequently suffer from headaches, chest pain, ear and eye pain, urinary tract infections, and other health problems. Sexual harassment and abuse are rampant on the production line. The supervisors, almost all men, castigate women in sexually derogatory terms when they do not meet production quotas, and often grope the women as they instruct them on how to work better. “Sometimes,” says Indirani, “I wouldn’t take a lunch break when pieces piled up. I didn’t want to be shamed in front of everyone. I would go to any length to avoid calling the supervisor’s attention to me.”

Indirani earned $100 to $110 monthly, depending upon her attendance, punctuality, and overtime hours. Frequently, she and her co-workers were unable to meet the inordinately high production targets and were required by supervisors to stay past regular working hours to meet their quotas. “Playing” catch-up, however, did not necessarily result in overtime pay. Indirani’s husband became suspicious if her paycheck did not reflect her overtime hours. He wondered whether she was really at the factory, or whether she was cavorting with another man. Indirani, like many of the women I interviewed, reported that she felt debased at work and at home.

Prior research on Bangalore’s female garment workers suggests that they work an average of 16 hours a day in the factory and at home doing laundry, cooking, taking care of children, and commuting to work. Working in the factory all day, and then returning home to complete household tasks was absolutely exhausting. Indirani’s friend Suhasini, who was also a surrogate mother, avoided garment work altogether. Her mother, sister, and other women family members had worked the line, and she knew it was not what she wanted for her life. “But I need money,” she told me. “For us,” she says, “surrogacy is a boon.” She describes Mr. Shetty who started COTW, as “a god to us.” When I met her again in December 2011, Suhasini was receiving hormonal injections so that she could be a surrogate mother for a second time.

For much of her working life Indirani has been intermittently employed in one of Bangalore’s many garment factories. She quit when pregnant, and joined the line again when her two children attended school. She also stopped factory work when she was sick, or had to care for sick family members. From the perspective of the garment factories, when Indirani is healthy she is a valuable worker for the firm. But during her pregnancies and illnesses, or when she has to attend to her family’s needs, she loses her value as a worker, and the company replaces her. She is, as anthropologist Melissa Wright calls it, a “disposable worker.” Upon recovering her health, or managing family chores efficiently, Indirani cycles back into the garment factory again, this time miraculously having regained her value for the production process. Over her working life, Indirani has shifted from being valuable, to becoming an undesirable worker who must seek other forms of employment to help support her family.

Making Babies

Indirani and her auto-rickshaw worker husband have struggled for much of their married life to make ends meet, and to support their small children. Indirani’s husband did not earn much money. He rented his vehicle from an acquaintance, and the daily rental and gasoline costs cut significantly into the household income. So Indirani and he decided to borrow money from her cousin to purchase an auto-rickshaw of their own. Their troubles worsened when they were unable to pay back the loan, and the cousin would often arrive at their door, demanding his money and screaming expletives at them. He would come to the factory on payday and take Indirani’s entire paycheck. She said, “I’d work hard, facing all sorts of abuse. And at the end of it I wouldn’t even see any money. I felt so bad I contemplated suicide.” When a friend at work suggested that she sell her eggs to an agency called COTW for approximately $500, Indirani jumped at what she perceived as a wonderful opportunity. After “donating” her eggs, Indirani decided to try surrogacy; she became pregnant with twins on her first attempt.

Photo by Sanjit Das (sanjitdas.com)

Indirani did not find surrogacy to be debasing work. She earned more money as a reproduction worker than she did as a garment worker, and found the process much more enjoyable. She was exhausted physically and emotionally working as a tailor in the factory and then cleaning, cooking, and taking care of her family. Upon getting pregnant, however, Indirani lived in the COTW dormitory. At first she missed her family, often wondering what her children were doing. Was her mother-in-law taking care of them? “I was in a different place surrounded by strangers,” she recalled. But soon she began to like the dormitory. She didn’t have to wake up by 5 am to prepare meals for the family, pack lunches for everyone, drop the children off at the bus stop so they could get to school, and then hop onto the bus herself to get to the garment factory. Instead, she slept in, and was served breakfast. She had no household obligations and no one made demands on her time and emotions. Surrogacy afforded her the luxury of being served by others. She did not remember a time in her life when she felt so liberated from all responsibilities.

Surveillance and Sisterhood

As she got to know the other women in the COTW dormitory, Indirani began to feel as though she was on vacation. For Indirani and many of the surrogate mothers I interviewed, it was easier to talk with the friends they made in COTW than with childhood friends and relatives; they felt they had more common with one another. Through the surrogacy process, many women told me, they lost a baby but gained sisters for life.

Photo by Sanjit Das (sanjitdas.com)

Noting the closed circuit cameras that monitored the
mothers’ every move in the dormitory, I asked how they felt about them. Indirani said they didn’t bother her; in fact, most of the mothers did not register the cameras’ presence. While this initially surprised me, I soon realized that they were accustomed to surveillance in their everyday lives. Living under the gaze of relatives and inquisitive neighbors, and housed in one-two room homes where it was common for six to eight households to share a bathroom, notions of privacy were quite foreign.Surveillance at the dormitory was benign in comparison to the surveillance and punishment meted out for supposed infractions on the garment shop floor, where long conversations with teammates, taking a few minutes of rest, or going on breaks were all curtailed. In comparison, surveillance at COTW, designed to check on whether the women were having sex with their men folk who visited the facilities, seemed relatively banal.

The surrogate mothers delivered their babies through caesarian surgeries between the 36th and 37th week of gestation in order to conform to the scheduling needs of potential parents. Indirani was initially fearful of going under the knife, but she saw many mothers survive caesarians and was no longer anxious. In the end, she found the caesarian method of delivering the twins she had carried easier than the vaginal births of her own two children.

Photo by Sanjit Das (sanjitdas.com)

Indirani claimed she does not feel any attachment to the twins she carried. “They were under contract. I couldn’t bring myself to feel anything for them,” she told me. “They were never mine to begin with, and I entered into this knowing they were someone else’s babies.” It is hard enough for her to take care of her own two children, she said. “Why do you think I’m going through all this now? What would I do with two more? They are burdens I cannot afford.” On the other hand, some mothers professed deep attachments to the babies they had given up. Roopa, a divorced mother who gave birth to a baby girl three years ago, always celebrated her contract baby’s birthday. “June 21st akka,” she said, “I cook a special meal. My daughter doesn’t know why we have a feast, but it’s my way of remembering my second child. I still cry for that little girl I gave away. I think about her often. I could never do this again.”

Life out of Waste

Regardless of how they felt about the babies they had given up, the women almost all said they derived far more meaning from surrogacy than they did working under the stern labor regimes of the garment factory. In our conversations, time and again, women described the many ways they are deemed worthless in the garment factory. Their labor powers exhausted, their sexual discipline suspect, their personal character under question, they are converted to waste on the shop floor—until they are eventually discarded. On the other hand, Bangalore’s reproduction industry, they said, gave them the opportunity to be highly productive and creative workers once more.

Indirani contrasted the labor processes in producing garments and producing a baby: the latter was a better option, she said. “Garments? You wear a shirt a few months and you throw it away. But I make you a baby? You keep that for life. I have made something so much bigger than anything I could ever make in the factory.” Indirani observed that while the people who wore the garments she’d worked on would most probably never think about her, she was etched forever in the minds of the intended parents who took the twins she bore.

Indirani and the other mothers I met did not necessarily see selling eggs or surrogacy as benign processes. Nor did they misread their exploitation. However, given their employment options and their relative dispossession, they believed that Bangalore’s reproduction industry afforded them greater control over their emotional, financial, and sexual lives. In comparison to garment work, surrogacy was easy.

Surrogacy was also more meaningful for the women than other forms of paid employment. Because babies are life-affirming in ways garments are obviously not, surrogacy allowed women to assert their moral worth. In garment work their sexual morality was constantly in question at the factory and at home. At the dormitory, in contrast, they were in a women-only space, abstaining from sex, and leading pure, virtuous lives.

Through surrogacy, Indirani said, she had built a nuclear family unit and fulfilled one infertile woman’s desire to be a mother. In the process, she had attempted to secure the future of her own family and her own happiness. As a garment worker Indirani felt she was being slowly destroyed, but as a surrogate mother she said she was creating a new world. She was ready to go through surrogacy once again to earn money for her children’s private schooling. The last time we met in December 2011, Indirani asked me, “If anyone you know wants a surrogate mother, will you think of me? I want to do this again.”

Recommended Resources

Haimowitz, Rebecca and Vaishali Sinha. Made in India (2010). This is a feature length documentary film on surrogacy in India, which explains the organization of the industry through the journey of one American couple to an Indian surrogate.

Pande, Amrita. “Commercial Surrogacy in India: Manufacturing a Perfect Mother-Worker,” Signs (2010) 35: 969-992. This is an account of surrogate mothers living in dormitories in Anand, India.

Teman, Elly. Birthing a Mother: The Surrogate Body and the Pregnant Self. (University of California Press, 2010). The book documents the relationships between straight women and their surrogates in Israel, where assisted reproductive technologies are subsidized for heterosexual couples.

Wright, Melissa. Disposable Women and Other Myths of Global Capitalism. (Routledge, 2006). An anthropological description of how women in the global south are seen as bad workers, and yet their work is crucial to multinational companies’ profits.

The neighborhood where financial traders ply their trade became the stage for dissidence of a sort that we have not seen in this country for a very long time. There one could witness—and quickly become a part of—dozens of simultaneous small group conversations about student debt, veterans’ post-traumatic stress, or the complexities of credit-default swaps, “fracking,” and more. Nightly meetings, called general assemblies, were like New England town meetings with an anarchist edge, marked by youthful exuberance and the sense that here was history-in-the-making.

The protests went into hibernation, thanks to the efforts of city governments from New York to Oakland to break them up. But, at this writing, efforts to regroup are now underway.

We asked experts, representing a range of perspectives, to comment on the “Occupy” movement and its significance. How can we account for its sudden emergence? What are its distinctive characteristics, its intellectual and social roots, and its likely future? Together, they offer a lively set of commentaries that help us to make sense of this moment of rage and hope.

1. Revolt of the College-Education Millenials, by Ruth Milkman
2. What Democracy Looks Like, by Benjamin Barber
3. The Global Culture of Protest, by Mohammed A. Bamyeh
4. A New Public Rhetoric for the Occupy Movement, by William Julius Wilson
5. The Anarchist DNA of Occupy, by Dana Williams
6. Occupy’s Political Emotions, by Deborah B. Gould

Revolt of the College-Educated Millenials

by Ruth Milkman

The Occupy Wall Street movement is, above all, a generational phenomenon. Like its counterparts around the globe, from Madrid to Cairo, to Tel Aviv to Moscow, many of the OWS protagonists are highly-educated young adults in their twenties and early thirties. The movement rapidly attracted adherents from a far more diverse population, but the key demographic driving its initial ascent in the fall of 2011 was college-educated “millennials,” the baby boomers’ offspring.

Photo by Accra Shepp

The OWS activists’ high level of formal education is also significant from another angle. They followed the prescribed path to prepare themselves for professional jobs or other meaningful careers. But having completed their degrees, they confronted a labor market bleaker than anytime since the 1930s. Adding insult to injury, many were burdened with enormous amounts of student debt.

In this sense, Occupy might be seen as a classic revolution of rising expectations. But it is not only about blocked economic aspirations: The millennials were also seduced and abandoned politically. Their generation enthusiastically supported Barack Obama in 2008; some participated in “Camp Obama,” and many were otherwise actively involved in the campaign. But here, too, their expectations were brutally disappointed. When a group of (slightly older) veteran direct action activists opened up a different political path, the millennials were primed to explore it. They embraced “horizontalism,” a form of of consensus-based participatory democracy that is inclusive and anti-hierarchal, as well as a “prefigurative politics” that aims to foreshadow a democratic social practice inside the movement itself. Both horizontalism and prefigurative politics are now widely viewed as OWS trademarks.

With an unintended boost from the overreaction of the New York Police Department to the occupation of Zuccotti Park, OWS garnered enormous attention in both conventional and “social” media. As it riveted public attention worldwide, the movement rapidly spread to every corner of the United States as well as to new venues abroad. It was not long before key labor unions and other progressive organizations stepped up to support OWS with both financial and logistical resources. (However, these pale in comparison to the funding the Koch brothers and others in the “1 percent” provide to the Tea Party, to which Occupy is sometimes compared.)

Although some observers were perplexed by the movement’s lack of conventional “demands” or a single “message,” OWS captured the imagination of the wider public. Its deceptively simple slogan, “We are the 99 percent!” raised popular awareness of the issue of economic inequality, stoking the moral outrage of ordinary citizens and transforming the national political conversation. The movement also deserves credit for a flurry of modest policy concessions: for example, extending the New York “millionaires’ tax,” which had been set to expire at the end of 2011.

The coordinated evictions of Zuccotti Park and various other encampments across the country made the strategic importance of those spaces more salient than before they were surrendered. Their loss, along with internal divisions that have, not surprisingly, emerged within the movement, has generated some uncertainty about the future. But whatever shape it assumes in the coming months and years, OWS seems destined to have a lasting impact on American politics and culture, like its counterparts around the world.

What Democracy Looks Like

by Benjamin Barber

Photo by Accra Shepp

In this Presidential election year, when the two parties are drawing further apart, it may be the decisions that OWS makes about national politics and participation in the elections that determine the future of our nation. For above all, OWS, like the Tea Party, is channeling anger at inequality and injustice. More like philosopher Jean-Jacques Rousseau than the Tea Party, however, OWS turns anger to constructive civic purposes. It distrusts the patter of politicians about democracy as one more transparent attempt to “throw garlands of flowers over our chains.” To be authentic, democracy must be palpable, participatory, local—like Occupy Wall Street itself.

If the myriad and varied denizons of this profoundly democratic movement decide to manifest their convictions politically and take a stand at the polls, they will contribute to revivifying democracy. If they withdraw from politics, and sit the election out while insisting that the differences between the parties and candidates are marginal and the similarities overwhelming, our democracy will be even worse off—whoever triumphs in the polls.

Understanding what OWS is as a political movement is therefore crucial. OWS certainly has an inclination to political commitment; but it also is skeptical about the political realm. OWS dismisses American democracy as a fraud—and sees politicians as just as corrupt and wayward as the bankers and corporate CEOs who have been buying them. At the same time, it holds up its own existence as a model of “what democracy looks like.”

To be sure, the occupiers, with their multi-hued cornucopia of perspectives, are a diverse lot. The many encampments embrace a panoply of causes, and contain tensions and fissures the protesters themselves acknowledge and even welcome. OWS has become a vessel into which people pour their own fears and aspirations. That is not to say there is no unifying theme. It’s “Occupy Wall Street” not “Occupy the Times Square military recruiting station” or “Occupy Gracie Mansion.” It’s about the MONEY, stupid–the money that replaces votes (the people) with dollars (the plutocracy). Money, OWS recognizes, has unraveled the social contract. The occupiers may not have demands, but they do have an agenda. It is their powerful process that speaks to their principles.

Their process is a bold attempt to embody an alternative paradigm of participatory engagement, suggesting that the protesters, so cynical about democracy, have figured out how to practice it. What the process offers is a compelling rejection of the instrumentalism so beloved of American politicians — “the end justifies the means.” President Obama has to raise funds from big-time bundlers and lobbyists (despite his pledge not to do so) — how else can he get reelected? Off-shore drilling may risk cataclysmic environmental disaster but we need the jobs and independence from foreign oil. The protesters’ principles, in contrast, are in their processes, and the processes are quite remarkable — not only for the contrast they offer to how we normally conduct business, but for how well they actually work.

The key process requires that all decisions — whether about tactics or money expended, or principles or changes in structure — be submitted to the General Assembly (GA), which then convenes almost every day and is the source of the movement’s “general will,” and its legitimacy. The GA’s process is maddeningly open, transparent, and changing.

Photo by Accra Shepp

Cynics on the right dismiss OWS as a bunch of crazies and collectivists, but I know of no democratic process so attuned to the autonomy and rights of individuals. Indeed, one of the serendipitous features of the process is the “people’s microphone” — an innovation necessitated by the refusal of the city to allow electronic voice amplification. With crowds of several hundred or more at the GA, individual voices cannot be heard, so speakers voice their concerns in snippets that are repeated by the crowd at least once, and sometimes twice, in an expanding circle.

The “people’s microphone” is a clumsy process that makes complex and nuanced speech difficult. But it forces relatively straightforward speech that enhances clarity and communication; and it requires that in dealing with naysayers and “blocks,” the majority must mouth and voice the actual words of those who disagree. How better to kindle sympathy for minority voices than for their majority opponents to rehearse their protests, word for word, and even mimic their affect? How fitting that a movement wedded to moral protest should be attuned to protests from within.

OWS may be naive and exasperating in its refusal to engage in ordinary politics and its initial disdain for voting, especially in this primary silly season where it is apparent how much is at stake. Yet the occupiers know that American anger, right and left, runs deeper; that there is something intrinsically wrong with how we do business. It has impaired leadership and undermined democracy.

Democracy itself is in deep trouble, and so America is in trouble. Occupy Wall Street speaks as our civic conscience. We need the angry deputies of the “99” in politics this year. But we cannot demand that they become more like us. We must become more like them.

The Global Culture of Protest

by Mohammed A. Bamyeh

A new global culture of protest began to take shape in 2011. It first appeared as a series of spectacular revolts in the Arab world, and soon inspired protest movements elsewhere. Each movement faced a distinct local environment. But as a whole these movements display at least six common features: they are the defining elements of a new global culture of protest.

First, the explicit target of this culture of protest is corruption. From the point of view of the protestors, the “system” (whether democratic or not) answers to special, if not secretive, interests, rather than to a popular will. The clearest signs of this corruption of political life is the unapologetic collusion of financial and political power.

Photo by Accra Shepp

Third, and perhaps as a result of the preceding, the protest movements are suspicious of parties and organizations in the traditional sense, as well as of leaders. They display a clear preference for loose networks and experimental structures. The protests derive a sense of direction not from hierarchy, or from a clearly elaborated common ideology, but from the energy of the protest itself, and by the discovery of others who share a similar world perspective. Disgruntled youth are the largest base of the protest; youthfulness and spontaneity becomes a metaphor for the desired rejuvenation of politics.

Fourth, all of these movements reject the idea, put forth by ruling parties or elites, that there is “no alternative,” that genuine opposition has disappeared in formal political life. They oppose the claim that global challenges tie the hands of leaders, and that genuine alternatives are incompatible with democratic process.

Fifth, this global culture of protest claims to address the interests of “the people” as a whole, or at least the 99 percent, or some super-majority, rather than the interests of a specific class (say, the working class). The Arab revolutions were all carried out in the name of “the people,” and this slogan seems to have migrated everywhere, summing up a demand to rejuvenate political life. “Peoplehood” (rather than specific disadvantaged sub-categories) stands opposed to governing systems.

Finally, in this global culture of protest, protesters’ demands possess an enticing vagueness. While this vagueness may make the protest less focused, it also makes it more attractive for the purpose of expressing indignation at the system as a whole, and from various points of interest. Participants appear to tolerate this vagueness because it provides their movement with a sense of experimental youthfulness and conversational conviviality.

We live in exceptional times. The year 2011 may be remembered as the year where various protest movements around the world took form without complex ideological language, and did not seem to be in a hurry to discover a new ideology to express the multiple interests that constituted them. They mobilized around a collective opposition to the “system” in the name of general abstraction — ”the people.” The little person, in whose face a large and unresponsive system had placed a “no alternative” sign, feels the need to respond by doing something great and noble. The birthplace of the new global culture of protest can be identified with precision: Sidi Bouzid, Tunisia, on December 17, 2010.

A New Public Rhetoric for the Occupy Movement

by William Julius Wilson

The Occupy movement has accomplished one very important goal—it has raised public awareness of the growing economic inequality in the United States. However, despite this worthy accomplishment, the movement has to yet to develop a vocabulary that helps ordinary Americans understand the legacy of rising inequality. I believe that the future impact and trajectory of the Occupy movement will be limited unless it develops a more comprehensive public rhetoric to help ordinary Americans understand how global economic changes, as well as monetary, fiscal, and social policies, have increased inequality.

Photo by Accra Shepp

The public rhetoric should inform or remind Americans that between 1947 and 1970 all income groups in this country experienced economic advancement. In fact, poor families recorded higher growth in annual real income than other families. However, in the early 1970s this pattern changed. The families in the highest income groups continued to enjoy steady income gains, adjusted for inflation, while the remaining families, especially the lowest 40 percent, experienced declining or stagnating incomes. What was unique about the 1950s and ’60s is that the government’s policies were integral to the gains experienced by all families. Low-wage workers benefited from a wide range of protections, including steady increases in the minimum wage, and the government made full employment a high priority. There was also a strong union movement that ensured higher wages and more non-wage benefits for ordinary workers.

However, in the 1970s and ’80s things moved in a different direction for ordinary workers. The union movement began its downward spiral and macroeconomic policy was no longer geared toward tight labor markets. Monetary policy became dominant, and it was focused on defeating inflation above all else. Beginning with the Reagan experiment, the tax structure became more regressive and Social Security taxes increased. Furthermore, congressional resistance to raising the minimum wage and expanding the earned income tax credit threatened the economic security of disadvantaged families.

History shows that trends of rising inequality are associated not only with economic changes, but also with the eroding strength of what the economist Frank Levy of M.I.T. calls “the nation’s equalizing institutions”—public education, unions, the welfare state broadly defined, international trade regulations, and so on. These equalizing institutions were much stronger from 1947 to 1970 than they are today. To combat rising inequality, the public rhetoric of the Occupy Movement should focus on the need to strengthen these equalizing institutions to produce a more equal pattern of family economic progress in the new economy.

The Anarchist DNA of Occupy

by Dana Williams

Occupy has drawn inspiration from many of 2011’s insurrectionary episodes, including Egypt’s Tahrir Square, Spain’s indignatos, and Puerto Rico’s student strikes. Also important has been Latin America’s horizontalism and zapatismo. But, the most immediate inspiration for Occupy is anarchism. This should surprise only the oblivious: many activists have noticed that American youth are influenced by anarchism more than by Marxism. The first manifestation of this influence is the emphasis upon anti-authoritarianism. There are no leaders (or, more radically, everyone is a leader). Anti-authoritarianism gives Occupy a strength and resilience not enjoyed by most movements. Like a multi-headed hydra, when Occupy’s enemies attempt to chop-off one head — arrest a certain individual — others take their place. No one is in a position to order anyone else around — everyone must participate in all decisions. Corporate media simply can’t understand this paradigm and it’s frustrated by Occupy’s disavowal of spokespersons.

Occupy’s next debt to anarchism is a procedural structure and aesthetic. For OWS, direct, participatory democracy is the order of the day. Lacking official leaders, consensus-building is the only feasible option. Every General Assembly (GA) attendee must be able to accept a decision. The task is assisted by multiple working-groups that meet regularly to discuss nitty-gritty issues. Facilitation guarantees that everyone’s voice is heard, and hand-gestures visually involve everyone. These techniques have popped-up in countless post-1960s anarchist projects. The results of this process can be seen in leaflets circulated at Occupy Oakland, characterizing several of the GA decisions as anarchistic in character: rejection of government endorsements and political parties, equal treatment of GA speakers, preventing police from entering the encampment, and solidarity with striking workers and students.

The movement’s militancy derives from its name. In contrast to other movements, Occupy attempts to reclaim public space, to confront others with its presence, and to stay in the news. Its impatience with polite lobbying or voting has an anarchist flair. Historically, anarchists have encouraged citizens to seize (and decentralize) political power, peasants to occupy private estates and collectivize them, and workers to take over the means of production. Occupy plays with anarchist notions of expropriation and seizing ill-gotten property for individual and collective needs.

Photo by Accra Shepp

Occupy has already enjoyed many victories, convincing countless people of the potential for radical social change. The mass media is now running stories on capitalism, social inequality, and direct democracy. Someone ought to thank Occupy for accomplishing in a few short months what sociologists have been unable to achieve over decades.

Occupy’s Political Emotions

by Deborah B. Gould

Photo by Accra Shepp

“Home” addressed those camping out, but I also read it as a proposition that anyone participating in Occupy was leaving behind the comfort and security that derive from familiarity and knowing what to expect. “Life,” in contrast to home, throws curve balls and is unpredictable. The welcome seemed like an invitation to inhabit the uncertainties entailed in activism— perhaps Occupy activism in particular — and asserted that this direct, engaged mode of politics would rejuvenate and even electrify those who participate.

Uncertainty: one of the Occupy movement’s notable qualities is participants’ appreciation for the fact that nobody knows precisely “what is to be done” to bring about fundamental social change. Political activism often means moving beyond what seems possible into an as yet unknown. It requires thinking and feeling your way, collectively, without a blueprint, embracing experimentation and improvisation, and realizing that mistakes, alongside learning, will necessarily occur. While the ambiguities of activism seem to generate anxiety among commentators who cannot understand what this movement is about, Occupy participants themselves seem able to inhabit that perhaps destabilizing, but also exhilarating emotional state.

Feeling alive: social movements are sites of collective world-making, spaces in which the ongoing interactions of participants produce sentiments, ideas, values, and practices that manifest and encourage new modes of being. Direct democracy is laborious, but Occupy participants exude excitement, even euphoria, suggesting how motivating it can be to engage in collective self-governance and develop new social relations, to come to know your own and other’s intelligences and capacities, and to be changed while building new worlds. Welcome to life.

Occupy illuminates something else about political emotions as well. With its critique of corporate intrusion into politics and with its practices of direct democracy and consensus decision-making, this movement forces a reappraisal of a conventional understanding of the American public as politically apathetic. The mushrooming of the Occupy movement within weeks of its emergence and its garnering of widespread, even mainstream support, suggest that a more familiar political detachment might signal precisely what it is assumed to lack: political desire—a desire, for example, that the state and its representatives speak to people’s needs, wants, and imaginations, and disappointment that they infrequently do so.

Rather than indifference, high rates of non-voting and a more general political withdrawal might better be understood as a response to the ineloquence of the political. By ineloquence I mean non-address: politicians rarely seek to understand and, more rarely still, attend to, people’s desires to create a better society. The Occupy movement invites a different, more active relationship to the political. The enthusiastic response reveals a widespread desire for political engagement. As noted in a piece of Occupy agitprop, “They say we don’t know what we want, but here we are making our decisions without bankers or politicians intervening in our lives. This is what we want.” Once people taste the joys of collective self-governance and sense the possibilities unleashed by becoming political protagonists, they may want more. We do not yet know what has been made possible in this moment of expanding political horizons.

Robert Antonio and Robert Brulle, in a 2011 article in Sociological Quarterly, argue that market domination, and the relentless drive for economic growth, is incompatible with ecological limits of any kind. And as Richard York and Brett Clark observe in a 2010 article in Sociological Inquiry, climate change deniers (or more politely, skeptics) are trying to protect free markets by sowing seeds of doubt about whether climate change really exists.

The growing polarization of elites, policymakers, and the public over climate change makes any large-scale compromise unlikely, according to Aaron McCright and Riley Dunlap in a 2011 Sociological Quarterly piece. The effect, according to Yannick Rumpala, writing recently in Theory & Society, is a “constrained space of possibilities” for addressing climate change and other environmental harms.

Instead of placing the blame on producers, where most people believe it belongs, consumers are being encouraged to go green. Yet in 2009, Thomas Dietz and his colleagues estimated that changing household practices and technologies will reduce overall U.S. carbon emissions by only 7 percent over 10 years, according to Proceedings of the National Academy of Sciences.

But as Janet Lorenzen’s 2012 study of “green lifestyles,” published in Sociological Forum, suggests, individuals aren’t renouncing collective action, or reducing their support for government regulation. Rather, they’re altering their behavioral and consumption patterns. Faced with the slowness of institutional change, and environmental policies that are mired in political conflict, they’re doing what they can—right away.

Katie Hyde likes taking pictures but is more inspired by what kids can do with cameras. For over ten years she’s been teaching college students, children, and classroom teachers in the Literacy Through Photography program at Duke University’s Center for Documentary Studies. She spends part of each year working in Tanzania and, whenever possible, escapes to southern Spain to take dance classes and behold the amazing art of flamenco. A sociologist by training, she also teaches Duke undergraduate courses that combine sociology, documentary studies, and photography.

Mediations

Kari Lerum has long been interested in why, how, and when people become central or marginalized within social groups; she is also fascinated by the ways that ideas about sexuality and the body are translated into political and cultural truths. While trained in sociology, she also teaches courses in Cultural Studies and Women, Gender, and Sexuality studies at the University of Washington (Bothell and Seattle). Her sociological imagination is enhanced by conversations with a variety of people, including policy makers, health care workers, grocery store clerks, and her 11-year-old daughter. She also blogs for Ms. Magazine, Rh Reality Check, and Sexuality & Society.

Trends

Tom Linneman is enamored with all types of trends. He owned a pet rock in the 1970s, pegged his jeans in the 1980s, danced the Macarena in the 1990s, and went crazy for cupcakes in the 2000s. Less faddishly and more sociologically, he keeps a close eye on trends in public opinion, the changing methodological landscape, and innovative attempts at social change, all of which he hopes to feature regularly in the Trends section. Most recently, he is the author of Social Statistics: The Basics and Beyond. Having just finished a five-year stint as chair of the sociology department at The College of William and Mary, he is quite happy to return to teaching and researching full time—and to join the crew of Contexts. He lives in Richmond, Virginia.

Books

Arvind Rajagopal is a professor in the department of Media, Culture, and Communication and affiliate faculty in the departments of Sociology, and Social and Cultural Analysis, at New York University. He’s the author of five books, including The Indian Public Sphere and Politics After Television. He is currently completing After Decolonization: The Cultural Politics of Globalization in India.

Pedagogies

Gary Kinté Perry distinguished himself in his first year of university teaching by having his students write and perform a play featuring classical sociological theorists. This same spirit of creativity and community animates his work on white racism in higher education, pro-feminist masculinity, perceptions of labor market inequality, and urban sociology. He has received recognition from the Seattle mayor’s office for his courses on community action research and gentrification in local neighborhoods. His passion for critical pedagogy is evident in the “domestic study abroad” course he teaches on post-Hurricane Katrina for his home department at Seattle University. He serves on the board of Washington Educators for Social Justice and is currently working on a book on the erosion of black space in an era of hyper globalization.

Five years earlier, Dr. Muhammad Yunus, an economics professor at nearby Chittagong University, had supported Bangladesh’s struggle for independence, only to see his new nation fall victim to apocalyptic famines soon thereafter.

Compelled to act, the Vanderbilt-trained economist turned to the market. In what he calls “a very modest local initiative,” Yunus befriended a handful of impoverished women entrepreneurs. Shunned by commercial banks, these women relied on village loan sharks to get the money they needed to buy the supplies to make and sell their hand-made crafts, such as bamboo stools.

The loan sharks charged exorbitant rates of interest, so—out of his own pocket—Yunus offered to help the women with very small loans at reasonable rates of interest.
The first few loans were repaid successfully, but Yunus says, “I realized very soon that the problem was not at all a local one. In order to solve the problem, the entire banking system would have to be turned upside down and fully reorganized.” And so, Yunus founded his own bank, the Grameen (“Village”) Bank—which would operate with different values and principles than typical commercial banks.

This article tells the story of how one man’s effort to help his village neighbors in need flourished into a $10 trillion global industry—albeit not necessarily the kind of industry he wanted it to be. It is a story about money and power; it is the story of microfinance. Only 35 years after its inception, nearly 4,000 microfinance organizations operate in over 100 countries around the world (even in the U.S.), providing very small business loans (typically under $1,000) and other financial services to over 150 million disadvantaged entrepreneurs who aspire to work their way out of poverty.

It was 1978 when Grameen officially began lending, and the bank’s business grew steadily. In 2010 it lent out nearly $10 billion to over 8 million people—over 90 percent of whom were women. Those 8.4 million people are not only the Bank’s beneficiaries, they are its owners; over 95 percent of Grameen’s equity belongs to them (the remainder is with the government), and each year Grameen’s net income is distributed to these owners in the form of dividends or deposited into an emergency relief fund borrowers can draw upon if they are affected by flooding or bad weather. In addition to sharing in Grameen’s profits, the borrowers share in its governance. Nine of the 13 members of Grameen’s board of directors are borrowers who have been elected to the board by their peers.

This was not the first institutionalized attempt to employ finance as a means of poverty alleviation and empowerment, but, arguably, Grameen has been the most successful. As the figurehead of the burgeoning microfinance movement, Yunus has garnered praise from world leaders, and he even won the Nobel Peace Prize in 2006. Despite these successes, Grameen has faced challenges. Researchers have noted that the bank’s claims to alleviate poverty are difficult to verify—and are frequently exaggerated—because Grameen tends to lend to people who already had favorable prospects for upward mobility before they began borrowing. Women who borrow with Grameen tend to have been more empowered before borrowing—not because of it. Further, many women turn over at least some of their loan to their husband; those who don’t may find themselves overburdened with both entrepreneurship and household chores. Economist Robin Isserles has questioned the logic of drawing the poor directly into an economic system that exploits them. He challenges the notion that microfinance could empower women without first changing broader structures of oppression in society.

But these quarrels are not to say Grameen is a failure. As the organization has grown, it has evolved in ways meant to try to address these criticisms. Today Grameen not only lends money, but also offers scholarships, low cost health care, solar power, and a variety of other services to Bangladesh’s rural poor. And while it may not live up to all expectations, most researchers who have studied the bank closely have found at least some benefit to its presence in Bangladesh. Worldwide research shows that it is possible for some poor persons to benefit from microcredit when conditions are conducive to entrepreneurship and when the credit is offered with low interest rates. This has made Grameen and microfinance appealing to activists and politicians alike.

The pace at which the microfinance movement has grown is astounding. No longer a village experiment, today’s microfinance is big business. A new generation of international lending agencies work for profits, even enlisting Wall Street investors. But such growth has come at a cost. The rhetoric of financial revolution that epitomized the early years of the movement has been supplanted by a free market discourse that has undermined local support for microfinance. This article offers a sociological perspective on how microfinance has grown and gone astray. The commercialization of microfinance is the result of co-optation by government-backed agencies. Through the provision of resources and information dissemination, they’ve turned a movement into a high-finance industry.

Change from the Bottom

In the early 1990s development practitioners and humanitarian activists seeking an alternative to the usual bureaucratic, big government approaches to poverty alleviation began arriving in Bangladesh to see for themselves how Grameen worked. Visitors from Vietnam, Columbia, Botswana, and myriad other nations would spend two weeks in the villages of Bangladesh, then convene in Grameen’s head office for semi-annual “Grameen International Dialogue” sessions. Participants exchanged ideas about how to implement microfinance projects in their own countries. The atmosphere was kinetic and hopeful; this was truly a global movement.

For microfinance to spread beyond Bangladesh’s borders, though, required more than just attention: it needed money. The untold story of the microfinance revolution is the persistent lobbying efforts of a small, but highly dedicated group of activists in the United States. The leader of this group, Sam Daley-Harris, founded a citizens’ lobbying organization called Results in 1980. The group is dedicated to passing legislation that will end hunger and poverty worldwide. “The change that is needed will have to come from the bottom,” asserts Daley-Harris. In his book, Reclaiming Our Democracy, Daley-Harris recounts the efforts of Results’ activists and offers some insight into Results’ strategy. One notable strategy was to creatively frame his group’s message in ways that would resonate with the Reagan-era conservatism that pervaded Washington, D.C. at the time. To the extent that Results was effective in this tactic, it also changed the trajectory of microfinance.

For example, Steve Valk, an activist in Atlanta, worked tirelessly to gain the attention of his staunchly conservative representative in Congress, Pat Swindall. Valk was not conservative, but he and other activists met with Rep. Swindall repeatedly, showing up at various town hall meetings specifically to press the issue of microfinance. In spite of ideological differences, the group developed a relationship with Rep. Swindall. They appealed to his conservative nature by likening microfinance to free market economics and presenting microfinance as a hand-up rather than a hand out. And, although the idea for microfinance originated in Bangladesh, they sold it as a profoundly American concept. Rep. Swindall eventually signed on to a bill to fund microfinance loans to hundreds of thousands of Latin America’s poorest families.

Due in large part to Valk and other Results volunteers around the country, the bill gained broad bipartisan support in both houses of Congress. One Congressman remarked, “I have never encountered an issue that had as many members [of Congress] massaged into place by constituents in such a timely fashion.” Although strongly supported, the bill did have its detractors. Most notably, administrators of the federal government’s agency for foreign aid, the U.S. Agency for Development (USAID), were immediately opposed to the bill. One senior USAID official flatly told Daley-Harris, “[US]AID doesn’t work with the poorest of the poor.” Instead, the agency preferred a trickle-down approach through economic growth. USAID sent letters to every member of the Senate to try to dissuade them from voting for the bill—or at least to soften
the bill’s mandate to lend to the poorest of the poor.

In spite of such high-level resistance, the bill passed in 1987, thus inaugurating a new era for the microfinance movement. Daley-Harris unabashedly claimed that Results “blew things wide open” with that bill. Now the Grameen idea would be known throughout Latin America—and soon the rest of the world. But hard fought victories often come at a cost: these newly funded microfinance programs would be administered by the same powerful and well-established agency that had opposed the microfinance bill, USAID.

Control from the Top

Daley-Harris soon found himself locking horns with USAID over the implementation of microfinance funding in Latin America. USAID remained reluctant to implement the Grameen model. One might have taken this power struggle as an omen that growing the movement too quickly could mean relinquishing control to powerful governmental agencies with conflicting ideals and motives. However, Daley-Harris remained committed to globalized microfinance, which he intended to advance by organizing the Microcredit Summit in Washington, D.C. in 1997. The event was attended by 2,900 delegates, including government officials and celebrities from 127 nations who agreed to a goal to reach 100 million of the world’s poorest families with microfinance loans.

This goal was met by 2007.

It could not have been done without the financial support of large government-backed agencies. In the 1990s, USAID was joined in the microfinance movement by the most influential of all such agencies: the World Bank. Originally created in the aftermath of World War II to rebuild Europe, the World Bank now manages a $112 billion portfolio intended to foster economic development around the world. Typically, the World Bank approach has been predicated on mainstream economic principles, which have often translated into policies that favor economic growth over social justice and free markets over social spending. Such policies have been met with anger and local resistance around the world, especially in poorer nations. Throughout the 1980s and ‘90s, the World Bank was bedeviled with riots, protests, and criticism in cities and villages around the world. As Grameen’s popularity grew, World Bank officials saw a foray into microfinance as an opportunity to improve their public image while still adhering to core, free market values. The willingness of private foundations to collaborate in this endeavor also made microfinance appealing. Unlike USAID a decade before, the World Bank expressed keen interest in microfinance and, true to form, did so in a grand manner.

In 1995 the World Bank established a consortium of 33 high-level public and private funding organizations and invited Muhammad Yunus to join its board of directors. The consortium was named the Consultative Group to Assist the Poor (CGAP), and its purpose was to support the growth of microfinance. In her book, Poverty Capital, Ananya Roy, a scholar of city and regional planning, shows how CGAP was able to assume control over the agenda of microfinance. With over 1,000 publications posted online, CGAP now sets the standard for everyone to follow. It establishes norms, metrics, and best practices for the industry, and these look remarkably similar to the norms, metrics, and best practices of Wall Street. CGAP also offers real time credit ratings and ranks the top microfinance providers based on financial and outreach criteria, but notably not on social impact. CGAP has even helped to develop global risk scoring models similar to the consumer credit systems used in the U.S. According to one senior CGAP staff member, “What is measured is what is managed. We script. We manage. We control.” Thus, the task of fighting poverty becomes akin to any other business venture, based on financial benchmarks and procedures that cater to the interests of investors rather than the needs of the borrowers. The intent is to bring microfinance into the fold of the World Bank’s paradigm of economic growth, which necessitates corporate capital.

To this end, CGAP has teamed up with the Gates Foundation to establish an elite annual conference in scenic Turin, Italy. The annual conference now garners far more attention and holds far more political sway than the much humbler Grameen International Dialogue. The cost of attendence, nearly $10,000 per person, is steep; but participation conveys a mark of validation and authority within the microfinance industry. There is little talk of poverty alleviation at this conference and much more talk of “going to scale.” As a result, high interest rates—often exceeding 30 percent and frowned upon at the Grameen International Dialogue—have become a “best practice.” Presumably, these higher interest rates generate more income and, in turn, allow lenders to reach more people. Theoretically, high interest rates also allow lenders to allocate loans more efficiently, since only the most lucrative businesses could afford to take such costly loans. To an economist, this makes perfect sense. But to a poor entrepreneur on the margins of subsistence, high interest rates are simply immoral.

The Microfinance Machine

Muhammad Yunus resigned from CGAP’s board of directors after only two years. He may have turned banking upside-down, but the World Bank flipped it back over again. The focus had shifted from poverty-alleviation and empowerment to organizational efficiency and profitability. That meant high interest rates and unforgiving terms and conditions—not unlike the loan shark market Yunus had hoped to subvert. In statements to the press, Yunus has decried what he calls the “commercialization” of microfinance—the corporate ownership of microfinance institutions. But his pronouncements have not deterred media criticism and political backlash in his home country. Bangladeshi politicians now associate Grameen with the new breed of microfinance and accuse Yunus of usury. Actually, Grameen’s interest rates remain comparable to commercial bank rates for small loans, but facts like these don’t seem to matter in moments of public outrage, and the Prime Minister of Bangladesh accused Yunus of “sucking money out of the people” before she forced

him to resign from the bank he started. Meanwhile, in neighboring India, angry protestors filled the streets of Hyderabad in the fall of 2010 demanding tighter regulation and lower interest rates for microfinance after the suicides of several desperately indebted farmers. Borrowers throughout the region refused to repay their loans, leading to a crisis akin to Wall Street’s mortgage meltdown. It was what Daley-Harris called “a near death experience for microfinance.” This is significant because the region surrounding Hyderabad, Andhra Pradesh, had been recognized worldwide as a pioneer market for the new form of commercialized microfinance, fed on investments from international corporations for rapid growth.

In their study of Andhra Pradesh published just before the 2010 crisis, political scientists Britta Augsberg and Cyrill Fouillet presciently opine: “One needs to ask whether… the ‘microfinance machine’ has gone berserk. Whatever the answer, we see it as an occasion to trigger a collective and widespread reflection on the dysfunction of microfinance, not only in India but the worldwide sector as a whole.”

While Yunus implies that corporate investors are to blame for this situation, evidence shows that the private sector did not force itself upon microfinance. Rather, powerful agents like the World Bank strategically redesigned microfinance to induce corporate participation. While we might be tempted to blame organizations like the World Bank for fostering the current situation, it is important to note that it was the proponents of microfinance themselves who solicited the support of these organizations and at times willingly collaborated with them. Advocates, like the Results volunteers, employed free market rhetoric to garner political favor and access the resources necessary to grow their movement exponentially. But this meant that the movement became beholden to the values and principles of its donors, not its constituents.

It is not too late to apply the lessons learned to the microfinance movement itself. CGAP recently responded to criticism by toning down its free market rhetoric, and, in addition to traditional financial indicators, it is now utilizing some social performance indicators to monitor microfinance. CGAP’s responsiveness suggests there is an opportunity for the kind of civic engagement that Sam Daley-Harris and his volunteers exhibited in the 1980s; advocates could lobby donor agencies and policymakers to ensure the people’s interests are protected. But this time it could happen not only in the U.S., but around the world. Modern technology affords the opportunity for the people of Andhra Pradesh to join forces with advocates in the U.S. or anywhere else to demand appropriate financial services and other forms of community support. At the same time, advocates could draw upon the lessons learned from Andhra Pradesh and Wall Street to foster a sincere discussion about the proper role of finance in our daily lives—not solely as a tool for economic growth, but also as a way to empower people to lead better, more fulfilling lives.

Rather than depending on investors, microfinance providers could also return ownership to their borrowers—a fundamental innovation of the Grameen Bank that was forgotten as the movement went global. Though this strategy would entail slower growth, it may be preferable to the rise of another meltdown of the sort that occurred in Andhra Pradesh. Borrower-owned microfinance would return control to the people microfinance seeks to empower, enabling them to decide for themselves what the appropriate means of economic development might be.

Recommended Readings

Augsberg, Britta and Cyril Fouillet. “Profit Empowerment: The Microfinance Institution’s Mission Drift.” Perspectives on Global Development and Technology (2010), 327-355. Recounts how market-based microfinance went awry in Andhra Pradesh.

Daley-Harris, Sam. Reclaiming Our Democracy: Healing the Break between People and Government (Camino Books, 2004, 10th anniversary ed.). Offers a detailed, first-hand account of the creation and growth of an organization and offers lessons for would-be activists and lobbyists.

Isserles, Robin. “The Rhetoric of Empowerment, the Reality of ‘Development as Usual’,” Women’s Studies Quarterly (2003) 31(3/4): 38-57. Critiques microfinance’s flaws and shortcomings.

Roy, Ananya. Poverty Capital: Microfinance and the Making of Development (Routledge, 2010). Looks inside the World Bank to see how it controls the development agenda.

Yunus, Muhammad. Banker to the Poor: Micro-lending and the Battle against World Poverty (PublicAffairs, 1999). Provides a philosophy of development and a first-hand account of the Grameen Bank.