Microcredit: A Weapon In Fighting Extremism


By Alan Jolis

Herald International Tribune Published with the New York Times and The Washington Post Singapore, Wednesday, February 19, 1997 PARIS – The success of microcredit in combating finally being recognized this month. Hillary Clinton opened the World Summit on Microcredit in Washington. The occasion highlighted the effectiveness of using tiny loans to help the most destitute people on earth pull themselves and their families out of poverty. But there is another, astonishing side of this story: the political consequences of putting capitalism to work for the have-nots. Microcredit not only liberates the poorest of the poor from hunger, it liberates them, and us, from fanatical extremists.

Microcredit was invented 20 years ago in Bangladesh by Muhammad. Today, Professor Yunus’s Grameen Bank and copycat organizations have 3.5 million women borrowers; adding their dependents, that amounts to about 20 percent of Bangladesh’s population. In the latest elections, held on June 12, 1996, these newly enfranchised flexed their muscle. The Islamic Society, the fundamentalist party antagonistic to the West that wants to keep women at home, lost 14 of its 17 seats in Parliament.

Immediately after the vote, Mr. Yunus began getting angry phone calls from people blaming him for the results. But Mr. Yunus assured them that fundamentalists had only themselves to blame. It was their supporters who burned down microcredit banks, attacked borrowers and condemned microcredit as un- Islamic because it helps women become self-employed.

Every woman borrower I interviewed in Dhaka, Chittagong and Cox’s Bazaar had suffered enormously at the hands of fundamentalists. Some were beaten; others were told they would be denied proper Islamic burial; still others that Grameen would sell them into slavery, feed them to tigers, take them out to sea and drown them, or tattoo their arms with a number and secretly turn them into Christians.

Having braved physical and mental abuse and used microcredit to build decent housing, freshwater wells and sanitary toilets for their families – it’s not surprising that these women went to the polls and voted against the mullahs.

The exact number of women who voted is not known, but observers across Bangladesh estimated that for the first time, more women voted than men. At a meeting of the Council of the Americas in New York, geo-strategists astonished by how microcredit worked to combat fundamentalism peppered Mr. Yunus with questions. He explained that microcredit was not at war with anyone, certainly not with Islam; it avoids all use of force and relies on future borrowers to convince village patriarchs to invite banks in.

Giving those whom society treats as less than human access to personal profit and self- esteem unlocks a static hierarchy. It allows social mobility. Suddenly, the old repressive, patriarchal ways become less relevant.

Microcredit does what billions of dollars worth of AWACS and Patriot missiles cannot. For decades, the West has tried to defeat fanatical extremists militarily; this has been bloody, costly and highly unsuccessful. But quietly, every day, the attraction of militant Islam is being blunted, at the ballot box and in people’s hearts and minds, thanks to the economic development of the poor.

We have known that micro-credit helps solve a host of in-tractable, long-term social ills related to poverty: In Norway’s arctic circle, it is helping repopulate the Lofoten Islands. In Oklahoma, thanks to Chief Wilma Mankiller of the Cherokee Nation, microcredit is helping reduce alcoholism. In Chicago, it is helping get unwed mothers off welfare.

But we should not overlook microcredit’s political dividends. If the West is truly concerned about pariah states exporting terrorism, it should get behind microcredit and support it with more than just lip service.

What is needed is patient start-up capital: 99 percent of the loans are repaid. After 20 years, Grameen is a commercially profitable bank. But more important, it saves its borrowers’ lives – and it can save ours, too.

The writer, a novelist, is writing a biography of Muhammad. He contributed this comment to the Herald Tribune.