[p2p-research] Non-failure of microcredit

[Kevin Carson]

On 8/27/09, christopher macrae <chris.macrae at yahoo.co.uk> wrote:

> It is a dagger to my heart to see this open knowledge community start a thread called failure of microcredit. I leave you to judge whether it is a dagger to what you stand for too.
>
> Microcredit as innovated in 1970s Bangladesh is a system which like any system has core rules which if you break them compounds opposite consequences
>
> Microcredit's system design has NOT failed; what has happened is big banks and others have spun imitations whose rules were tampered with to spin opposite results. Its pretty amazing we are having this conversation when the reality is the failure of 99% of banking that isnt microcredit - at least I thought that was lesson of wall street last year
>
> Microcredit uses money's exchanges to create a lifetime community club owned by the poorest- they define what they want the surplus of the bank to be invested in next to end poverty- in bangladesh their choices that were researched "16 decisions" before grameen was founded  by bangladesh law as a bank owned by poorest .
> Two 2 minute lessons 25 from 10000 free dvds on microcredit http://yunus10000.com

In any case, even stipulating the failure of Grameen, that is not the
same thing as the failure of microcredit as such.

First of all, the idea of microcredit is much broader, and includes
far more possibilities, than the Grameen model alone.  For example, a
mutual account-clearing system like Greco proposes, if it allowed (as
he also proposed) running deficits equivalent to three months average
income for the member, that would amount to an interest-free
microcredit system.  Three months' pay for a wage-earner in the U.S.
would be sufficient capital for a wide range of low-overhead
microenterprises.

Second, the real future of microcredit IMO will be not when it
coexists with a functioning capitalist banking system, but when it
fills the vacuum left by the collapse of that system.  The heyday of
LETS systems and barter networks was in the Depression, when the
supply of official money dried up, and alternative currency was the
primary means for providing liquidity for direct exchange between
producers.  Likewise, distributed peer lending systems will come into
their own as a means of aggregating dispersed capital, when it is the
only means available for ordinary people to amass capital for
production in the household and informal sector and keep themselves
fed and supplied with other goods.

-- 
Kevin Carson
Center for a Stateless Society http://c4ss.org
Mutualist Blog:  Free Market Anti-Capitalism
http://mutualist.blogspot.com
Studies in Mutualist Political Economy
http://www.mutualist.org/id47.html
Organization Theory:  A Libertarian Perspective
http://mutualist.blogspot.com/2005/12/studies-in-anarchist-theory-of.html