Living On $2 A Day: An Interview With Economist Jonathan Morduch

According to the World Bank, almost forty percent of humanity lives on a daily income of less than two dollars per day. Another 1.1 billion scrape by on less than one dollar per day.

How can anyone possibly survive or raise a family with such a meager income? In New York City, two dollars per day won’t even cover my daily Brooklyn/Manhattan round-trip subway commute. Yet billions of low skilled people put food on the table, educate their children, grapple with unexpected emergencies and even save money.

In Portfolios of the Poor: How the World’s Poor Live On $2 a Day, Darryl Collins, Jonathan Morduch, Stuart Rutherford and Orlanda Ruthven, compiled yearlong “financial diaries,” of villagers and slum dwellers in Bangladesh, India and South Africa. The diaries track penny by penny, how specific households manage their money with sophistication and resourcefulness. Recently published by Princeton University Press, Portfolios of the Poor, presents revealing data in an accessible seven chapters and 184 pages of text. The text is supported with an additional eighty plus pages of appendices, data tables and notes illustrating “the story behind the portfolios.”

In a tour de force of primary research, the authors report that the world’s poorest do not live hand to mouth and desperately spend what they earn just to keep from drowning. Instead, they utilize financial tools, rely on “informal” networks through relatives and neighbors and navigate perils such as medical calamities and political strife. Their stories are both inspiring as well as heartbreaking.

Although the world’s poorest are far more adept at financial management then previously understood, they’re confronted with what the authors describe as the “triple whammy”:

• Low income
• Irregularity of income.
• Unpredictability about when they will earn income.
  

Hence, the authors assertively advocate for microfinancing as a means of empowering the world’s poorest with more secure and convenient instruments to access and manage money. Microfinancing is financial services for low income clients in the world’s poorest countries who are self-employed or operating their own businesses.

The authors argue in their book that microfinancing should also be extended to address the needs of exceptionally low-income wage earners as well. It is their contention that poor people in the countries they researched demonstrate on a daily basis that they are responsible money managers and would also be reliable clients of microfinancing services.

One of the authors, Jonathan Morduch, is a New York University ("NYU") professor of economics as well as a managing director of the Financial Access Initiative - a consortium of researchers at NYU, Harvard, Yale, and Innovations for Poverty Action. Morduch, agreed to a telephone podcast interview with me about the book and our conversation was just under twenty-six minutes.

Among the topics covered was how his team earned the confidence of the people interviewed, the informal market tools utilized by the world’s poorest in Bangladesh, India and South Africa and why he’s a proponent of extending microfinancing to the world’s poorest wage earners.

Please refer to the flash media player below.



This interview can also be accessed at no cost via the Itunes Store by searching for either the “Intrepid Liberal Journal” or “Robert Ellman.

Saturday Morning Ponderings

This entire week I have endured the mother of all colds. Yet even in my Sudafed haze, I must comment on this week’s important developments:

• This week Treasury Secretary Tim Geithner finally rolled out his public/private partnership plan with respect to “toxic assets.” His so-called plan has me thinking about the dangers of treating symptoms instead of the cause. A fever is the body’s way of sending us a message that we need to kill off an infection. Similarly, these “toxic assets” are sending the international community an unmistakable message; hyper-sized financial institutions are a parasitic infection eroding quality of life for wage earners across the globe.

• Removing toxic assets is not treating the cause. And while more regulation is entirely justified and something we liberals have been insisting upon, that too will not treat the cause. Instead, citizens need to mobilize on behalf of bold anti-trust legislation that breaks up financial institutions such as CitiCorp and empower independent community banks. Do not be seduced by the gyrations of the stock market that some liberal bloggers chirped about this week. Unless the cause itself is treated our economic destiny will remain perilous. I fully support President Obama's ambitious budget and have nothing but contempt for the insipid Republican opposition as well as corporatist enablers such Indiana Senator Evan Bayh who stand in the way. Yet even the good intentions and overdue initiatives proposed in Obama's budget will not benefit our country as it should unless we boldly reshape our entire financial system.
  

• President Barack Obama took complete ownership of the war in Afghanistan yesterday with his announcement of 17,000 more combat troops as well as an additional 4,000 non-combat advisers. One difference between Obama and his predecessor is the linkage between the fight against al Quaeda in neighboring Pakistan as well as their Taliban allies in Afghanistan. Another difference is how the Obama administration intends to combine military power with a surge in regional diplomacy and “experts” to help fight corruption and facilitate a civil society. Supposedly, the focus is entirely defeating al Quaeda and not nation building, but how the hell can we fight corruption in an ancient society we know precious little about?

• Meanwhile, the administration promises to both lean on and support the Pakistani government in their struggle against terrorists. Frankly, aid to the Pakistani government at this point appears every bit as wasteful as giving billions to A.I.G. The civilian government uses terrorism as an excuse to oppress its population as elements of Pakistan’s intelligence service and military aid the Taliban in Afghanistan. How do we know that any aid we provide Pakistan isn’t being utilized to plan another attack against us or help the wrong people obtain access to their nuclear arsenal?
  

• All this is further compounded by an ultra-nationalist government in India that would make American neo-cons blush with their belligerence. The sub-continent is the world’s most dangerous powder keg and America’s presence has intensified regional violence. Even so, I sympathize with President Obama’s conundrum. Twenty years ago, our careless withdrawal after the cold war’s end facilitated the blowback that resulted in 9/11 and gave al Quaeda its safe haven. Our careless withdrawal of course followed our ill conceived intervention on behalf of Aghanistan's Mullah's in the first place when we armed Bin Laden in his struggle against the Soviet Union. If we screw it up this time the consequences will be far more catastrophic.
  

• I’ve long believed that the best strategic approach is cooperative containment with the international community as opposed to grandiose delusions about “dismantling” and “disabling” al Quaeda. This is an organic movement. You can take out one important leader after the other including Bin Laden himself and it will simply regenerate. We need instead to address the causes of terrorism and work diligently at draining the swamp that fosters it. Anything less is a waste of blood and treasure. Not to mention all the innocent people being killed in Afghanistan by our presence. Also, we should be on the side of democracy in Pakistan instead of nurturing more resentment among Pakistan's decent civillian majority.
  

• Longtime readers of this blog know how vigorously opposed I am to our prison industrial complex. I have therefore been keeping an eye on Virginia Senator James Webb who since his election in 2006, has spoken coherently about the need to reform our prison system. With a sympathetic President finally in the White House, Senator Webb has opted to take the initiative and joined Republican Pennsylvania Senator Arlen Specter in that effort. Both senators proposed legislation to create a blue-ribbon panel that would conduct an 18-month review and suggest recommendations of reform.
  

• Specifically, Webb hopes to reform a system that incarcerates 2.4 million people and represents 25 percent of the world’s prison population even as America comprises only 5 percent of the entire planet. Mostly we have incarcerated people for petty drug offenses who need treatment instead of prison. This is an act of real political courage because any suggestion of reform usually results in accusations of being soft on crime.

• Coincidentally, while Senators Webb and Specter plot prison reform in America, New York State’s dysfunctional leadership is finally addressing the arcane “Rockefeller Drug Laws” that have empowered my home state’s prison industrial complex for three decades. My favorite legislator, New York State Senator Liz Krueger, announced in a press release this week that,
  

“I am very proud to be a part of history today and finally see the Rockefeller Drug Laws reformed. The reforms announced today will restore judicial sentencing discretion and substantially expand alternatives to incarceration for non-violent drug offenders.

It has been a long hard fight to reform these archaic drug laws and today is the culmination of decades of hard work and advocacy from countless people, all of whom deserve praise for helping to achieve these needed reforms."

• Reforming our prisons and drug laws will do more to curb violence in Mexico than any increase in numbers of our border patrol. Legalization and treatment will address the causes of drug abuse far more effectively than mindlessly incarcerating people and creating blowback in neighboring Mexico.

The one theme that emerges from the above bullet points is America's need to think about the cause instead of always reacting to the symptoms of what ails us.

Brain Mapping, Civil Liberties & Obama

Longtime readers of the Intrepid Liberal Journal may recall my April 2006 posting entitled, "Brain Fingerprinting and Civil Liberties." One mistake I made at the time was conflating the acronym FMRI (Functional Magnetic Resonance Imaging) with the term brain fingerprinting. Perhaps the most accurate generic term is brain mapping.

At the time I came across numerous references with respect to how brain mapping technology is implemented within India's criminal justice system. Specifically, I noted how an article in the March 17th, 2006 edition of New Kerela reported that Javed Shukat Khurshid, one of seven convicted murderers escaped police custody after sentencing. It read like any other newspaper might over such an event except for this:

“The court had earlier awarded life imprisonment to Javed and six others, including Ismail Barafwala, Amjad Khan Pathan, Mehboob Khan Pathan, Sajid Khan alias Anna, Usman Gani alias bhola and Younis Sheikh for rioting and murdering a man on November 11, 2003.

The judge awarded the sentence after considering the results of the brain finger printing tests performed on the accused, among other facts in this case.”

As I learned two years ago, the integration of brain mapping technology with India's criminal justice system is common practice. Since then I've been concerned with how America reconciles sophisticated technology such as brain mapping and civil liberties. With respect to the federal judiciary, our body politic typically obsesses over cultural issues and neglects to ask what predisposition or ideology any justice a president nominates will bring to cases involving high technology. Instead we wage culture wars over reproductive rights, gay marriage, affirmative action and so forth. I fear America could integrate brain mapping technology into our criminal justice system without any debate or even notice it happening.

Two years ago I wrote:

"We know that polygraphs, commonly known, as lie detectors are unreliable. Whether FMRIs are reliable requires more empirical data. Perhaps such a device may prove effective in solving crimes or preventing terrorism. The potential to save lives certainly exists and can’t be casually dismissed.

However, it’s use means encroaching upon the province of an individual’s thoughts and what government on Earth can be entrusted with such power? What is the legal framework for deploying this technology? Suppose employers coerce employees into signing waivers for FMRI scans to be administered? What if whistle blowers are intimidated into silence because of FMRI scans? Do the potential lives saved from crime prevention justify the potential abuse?"

These are the sort of questions future justices nominated by President-Elect Barack Obama for the Supreme Court as well as lower courts will have to answer. Now two years later I've come across a September 16th article of Finding Dulcinea that reports India's courts are being criticized for using brain scans.

Specifically, Finding Dulcinea reports how an Indian student named Aditi Sharma was convicted earlier this year of murdering her ex-boyfriend Udit Bharati by giving him a “Prasad” laced with arsenic. Brain Electrical Oscillation Signature (BEOS) profiling, a brain-scanning technique developed by Indian neuroscientist Champadi Raman Mukundan was a component of the government's case against Sharma.

As the article notes, Sharma underwent a BEOS test, which involves an electroencephalograph measuring the electrical activity in her brain:

"Wearing a cap with 32 electrodes connected to a computer, Sharma sat quietly as she was read a description of the crime in the first person. When she recognized an event, specific parts of her brain that contain 'experiential knowledge' lit up and were detected by the BEOS computer."

With respect to Sharma's case, a July 21st edition of The Times of India, also referenced by Finding Dulcinea, reported that,

"Aditi was found to have experiential knowledge for having a plan to murder Udit by giving him arsenic. Experiential knowledge was also found of her having gone to a temple to collect 'prasad', buying arsenic from a shop, calling up Udit and giving him the poison-laced 'prasad'.

Emotional experience of getting relieved and scared in connection with giving the arsenic laced 'prasad' to Udit was also found present on the BEOS test. Aditi also underwent a lie-detector test, which revealed deception on all relevant questions. The judgment copy dedicates about 10 pages on how the BEOS technique was conducted."

Ultimately, how technology is developed elsewhere has repercussions everywhere. Whatever you want to call it - FMRI scans, BEOS tests, brain mapping or brain fingerprinting - is technology scientists are actively pursuing worldwide and monitoring the innovations of their peers. The BEOS system was created from technology and theories devised by several American scientists, including Lawrence Farwell, Emanuel Donchin and J. Peter Rosenfeld. Farwell is known as the pioneer of brain fingerprinting and even used the technology to help free innocent convict Terry Harrington after he had been falsely convicted of murder.

As I noted two years ago, the potential benefits of brain mapping technology should not be casually dismissed. Whether it's freeing an innocent person of a crime they didn't commit or preventing terrorism, the potential for good certainly exists. One could even argue that use of such technology completely obliterates the rationale for torture. How can the government justify water boarding when they have the ability to utilize a high-tech mind meld at their disposal?

But the technology remains unproven and right now the price for integrating it into our our justice system appears too high. India's experience with brain mapping technology is instructive and should give all of us pause.

As one of the aforementioned American scientists on the cutting edge of developing brain mapping technology, J. Peter Rosenfeld noted:

“Technologies which are neither seriously peer-reviewed nor independently replicated are not, in my opinion, credible. The fact that an advanced and sophisticated democratic society such as India would actually convict persons based on an unproven technology is even more incredible.”

Fallout from the Sharma case may result in India's criminal justice system no longer using brain mapping technology to administer justice. A six member committee led by India's director of the National Institute of Mental Health and Neuro Sciences concluded that there is "sub-optimal scientific basis for them to be used as evidence in court of law.”

Yet the technology continues to go forward. Private security firms and scientists are actively soliciting America's federal government to utilize brain mapping technology in the "war on terror." What happens when the U.S. Supreme Court presides over cases in which brain mapping technology is a factor? How will the Supreme Court as well as lower courts rule if the technology is abused by the government or private corporations?

A decade ago President-Elect Obama taught constitutional law. Has he, I wonder pondered what the legal framework for brain mapping technology should be? Will President-Elect Obama or his Attorney General ask any prospective nominee to the federal judiciary their view of how to reconcile technology and civil liberties? He should. And it's our obligation in the progressive community to remind him.

Crusading For Justice & Peace: A Podcast Interview With Activist Marisa Handler

Marisa Handler lived in South Africa until she was twelve. Both her parents are Jewish liberals and they actively opposed South Africa’s racist apartheid system. Their values heavily influenced Handler during her formative years. Perhaps she was destined to become an activist as early as nine years old while attending Camps Bay Primary School in Cape Town.

One day during recess, a pre-adolescent queen bee named Joan, held court on the playground and asked several peers whom their parents were voting for in an upcoming election. One by one, the other students answered “Nats,” meaning the longtime ruling white supremacist National Party. Eventually, Joan turned her scrutiny on the self-conscious Handler who whispered “PFP.”

The PFP were the Progressive Federal Party that preached equality and represented a constituency of white liberals. Joan proceeded to interrogate Handler and asked if she really wanted to turn South Africa over to the majority blacks she called “stupid.” Fearfully, Handler held her ground and the foundation for a future activist was established: she had demonstrated the fortitude to take an unpopular stand and subject herself to ridicule.

Now thirty, Handler is a well-traveled and seasoned veteran in the pursuit of global justice and peace. Her book, Loyal to the Sky: Notes From an Activist (Berrett-Kohler Publishers, Inc.) is a stirring memoir about her personal evolution and experiences. Handler’s journey spans the playground in Cape Town, relocating with her parents to Los Angeles at the age of 12, Berkley University, Israel, Nepal, India, protesting the Free Trade Area of the Americas agreement in Miami, Ecuador, Peru, protesting the 2004 Republican National Convention in New York City and talking with soldiers in Fort Benning, Georgia.

Handler has worked as an organizer in the global justice and peace movements as well as written about socio-politics and globalization. Her work has been published in Orion Magazine, Tikkun, Salon.com, the Earth Island Journal, Alternet.org, Bitch Magazine and the San Francisco Chronicles. Currently, Handler resides in San Francisco where she is also a singer-songwriter. She plays regularly around the Bay Area and her album Dark Spoke is currently available on CD.

Handler agreed to a podcast interview with me and among the topics we covered were her book, music, work, spirituality, life experience, the Israeli-Palestinian conflict, Hindu/Muslim tensions inside India and the overall quest to achieve global justice. Please refer to the media player below.




This interview can also be accessed for free via the Itunes store by searching for Intrepid Liberal Journal.