Hillary Clinton, liberal virtue, and the cult of the microloan
By Thomas Frank
An exclusive first look at Thomas Franks new book Listen, Liberal! which
will be published next month by Metropolitan Books. Frank wrote the Easy
Chair column for Harpers Magazine from 2010 to 2014.
The day after International Womens Day in March 2015, I attended a Clinton
Foundation production put on by its No Ceilings initiative at the Best Buy
Theater in New York City. It wasnt a campaign eventthe 2016 race had not
really started at that pointnor was it a panel discussion, as there were no
disagreements among the participants or questions from the audience.
Instead, it was a choreographed presentation of various findings having to
do with womens standing in the world. But if you paid attention, the event
provided a way to understand Hillary Clintons real views on the great
social question before the nationthe problem of income inequality.
Onto the stage before us came former secretary of state Clinton, the
Democratic Partys heir apparent; Melinda Gates, the wife of the richest man
in the world (the event was produced with the Bill & Melinda Gates
Foundation); various NGO executives; a Hollywood celebrity; a Silicon Valley
CEO; a best-selling author; an expert in womens issues from Georgetown
University; a Nobel Prize winner; and a large supporting cast of women from
the Third World. Everyone strode with polished informality about the stage,
reading their lines from an invisible tele¬prompter. And back and forth, the
presenters called out to one another in tones of supportiveness and sweet
flattery.
In her introduction to the event, for example, the TV star America Ferrera,
who has appeared at many Clinton events both philanthropic and political,
gave a shout-out to the incredible women who have brought us all here
today and the amazing girls whose conversation she had been permitted to
join. Then Chelsea Clinton, who announced herself completely awed by the
incredible swell of people and partners who had participated in some event
the previous day, invited us to hearken to the inspiring voices of leaders,
of communities, of companies, of countries.
Those were just the first few minutes. It kept on like that for hours. When
someones potential was mentioned, it was described as boundless.
Peoples stories were compelling when they werent inspiring,
incredible, or incredibly inspiring. A Kenyan activist was introduced as
the incomparable.
But the real star of this show was the Creative Innovator, the figure who
crops up whenever the liberal class gets together to talk about spreading
the prosperity around more fairly. In this case, the innovations being
hailed seemed mainly to be transpiring in the Third World. Every year,
millions and millions of women everywhere are empowering themselves and
their communities by finding unique, dynamic, and productive ways to enter
the workforce, start their own businesses, and contribute to their economies
and their countries, said Chelsea Clinton, introducing an inspiring
innovator and chocolatier from Trinidad.
Melinda Gates followed up the chocolatiers presentation by heaping even
more praise: She is an amazing businesswoman, you can see why we all find
her so inspiring. Then, a little later on: Entrepreneurship is really
vital for women
. Its also their ability to advance into leadership roles
into corporations. And corporations play such a big role in the global
economy.
Roughly speaking, there were two groups present at this distinctly First
World gathering. Many of the people making presentations came from Third
World countriesa midwife from Haiti, a student from Afghanistan, the
chocolate maker from Trinidad, a former child bride from India, an
environmental activist from Kenya¬while the women anchoring this swirling
praise fest were former secretary of state Hillary Clinton and the wealthy
foundation executive Melinda Gates.
What this lineup suggested is that there is a kind of naturally occurring
solidarity between the millions of women at the bottom of the worlds
pyramid and the tiny handful of women at its very top. The hardship those
Third World women have endured and the entrepreneurial efforts they have
undertaken are powerful symbols of the struggle of American professional
women to become CEOs of Fortune 500 companies (one of the ambitions that was
discussed in detail) or of a woman to be elected president, which was the
unspoken theme of the entire event.
What the spectacle had to offer ordinary working American women was another
story.
That was my first experience of the microclimate of goodness that always
seems to surround Hillary Rodham Clinton. The mystic bond between
high-achieving American professionals and the planets most victimized
people, I would discover, is a recurring theme in her life and work.
But it is not her theme alone. Regardless of who leads it,
professional-class liberalism seems to be forever traveling on a quest for
some place of greater righteousness. It is always engaged in a search for
some subject of overwhelming, noncontroversial goodness with which it can
identify itself, and under whose umbrella of virtue it can put across its
self-interested class program.
There have been many other virtue objects over the years, people and ideas
whose surplus righteousness could be extracted for deployment elsewhere. The
great virtue-rush of the 1990s, for example, was focused on children, then
thought to be the last word in overwhelming, noncontroversial goodness. Who
could be against kids? No one, of course, and so the race was on to justify
in their name whatever your program happened to be. In the course of Hillary
Clintons 1996 book, It Takes a Village, for example, this favorite
rationale of the daythink of the children!was deployed to explain her
husbands draconian crime bill as well as more directly child-related causes
such as charter schools.
1 I am taking Democrats to task here, but of course Republicans do it too.
The culture wars unfold in precisely the same way as the liberal
virtue-quest: they are an exciting ersatz politics that seem to be really
important but at the conclusion of which voters discover theyve got little
to show for it all besides more free-trade agreements, more bank
deregulation, and a different prison-building spree.
You can find dozens of examples of this kind of liberal-class virtue quest
if you try, but instead of listing them, let me go straight to the point:
this is not politics. Its an imitation of politics. It feels political,
yes: its highly moralistic, it sets up an easy melodrama of good versus
bad, it allows you to make all kinds of judgments about people you disagree
with. But ultimately its a diversion, a way of putting across a policy
program while avoiding any sincere discussion of the policies in question.
The virtue quest is an exciting moral crusade that seems to be extremely
important but at the conclusion of which you discover youve got little to
show for it besides NAFTA, bank deregulation, and a prison-building spree.1
For all that, the Clinton Foundation event I attended gives us a context in
which to understand Hillarys most important moment as a maker of policyher
four years as Barack Obamas secretary of state. Although her purview then
was foreign policy, we can see from her deeds at State how she intends to
tackle the great economic question of our time. The themes will be familiar
to anyone who follows Democratic politics closely. She cast herself as a
high-minded ally of Silicon Valley. She enshrined a version of feminism in
which liberation is, in part, a matter of taking out loans from banks in
order to become an entrepreneur. And between these two doctrines, it seems
clear that income inequality has little role in the grand sweep of her
political career.
In emphasizing these aspects of her tenure at the State Department, I do not
mean to brush off the conventional diplomatic triumphs that Hillary Clinton
engineered, like the international effort to isolate Iran. Nor do I mean to
soft-pedal her conventional diplomatic failures, like the cataclysmic civil
war in Libya, a conflict Clinton worked so hard to stoke that the Washington
Post in 2011 called it Hillarys War. But I want to focus for a moment on
one of her early initiatives as secretary of state: something she called
Internet Freedom. This was to be the very cornerstone of the 21st century
statecraft policy agenda, according to the State Department, and Clinton
returned to the principle frequently. In a high-profile speech in January
2010, she declared that, henceforth, the United States would stand for a
single Internet where all of humanity has equal access to knowledge and
ideas. Committing ourselves to defending this unified Internet from all who
would censor it, she continued, was a logical extension of what Franklin
Roosevelt had been after with his Four Freedoms; it wasnt all that much
different from the U.N.s Universal Declaration of Human Rights either.
Now, understanding the Internet as a force of pure nobility is a pundit
tradition in the United States, and in the days when Clinton declared
humanitys Internet Freedom, those ideals were on the lips of every
commentator. In the summer of 2009, the Iranian regime had violently
suppressed a series of enormous street protestsprotests that, the American
pundit community immediately determined, were as much a testament to the
power of Twitter as they were about any local grievance having to do with
Iran itself. The so called Twitter Revolution fit neatly into the beloved
idea that new communications technologiestechnologies invented or dominated
by Americans, that ismilitate by their very nature against dictatorships, a
market-populist article of faith shared everywhere from Wall Street to
Silicon Valley.
Then there was the economic side of the single, unified Internet, and it,
too, was all about liberation. For the people at the bottom of the worlds
economic ladder, Hillary Clinton averred on that day in 2010, the Internet
was a savior. She knew of farmers in Kenya who were using mobile banking
technology, and of women entrepreneurs somewhere else in Africa who were
getting micro¬credit loans, and of a doctor who used a search engine to
diagnose a disease. I guess she hadnt heard about what these same
technologies were doing to the livelihoods of journalists or musicians or
taxi drivers in her own country, but I quibble; as long as this technology
was free, anyone could see that it pushed in one direction only, and that
was up.
Clintons other great initiative during her State Department days was the
so-called Hillary Doctrine: the recasting of the United States as the
worlds defender of women and girls. Now, here was a virtue quest of the
most principled kind. The single remaining superpower was no longer to be an
overbearing hegemon or a bringer of global financial crisisit was actually
determined to improve life for half of the planets population.
The secretary described the elements of the Hillary Doctrine in 2010 at a
TEDWomen conference, that great agora of the liberal class. I have made
clear that the rights and the roles of women and girls will be a central
tenet of American foreign policy, she said, because where girls and women
flourish, our values are also reflected. It was, Clinton continued, in the
vital interests of the United States of America to care about women and
girls. Her reasoning: the subjugation of women is a threat to the common
security of our world and to the national security of our country.
I was a little bit alarmed when I heard Secretary Clinton speak these
phrases in her deliberate way. Ordinarily, the words vital interest and
national security, when combined like this, suggest strong stuff: that the
United States has a right to freeze assets, organize embargoes, and maybe
even launch air strikesin this case, I suppose, against countries that
score poorly on the gender-equality scale.
Not to worry. Like so many high-minded Democratic virtue quests, this one
turned out to be largely concerned with the personal, with foundations and
private companies that would partner with the United States to do things
like improve maternal and child health, close the global gender gap in
cellular-phone ownership, persuade men and boys to value their sisters and
their daughters, and make sure that every girl in the world has a chance
to live up to her own dreams and aspirations.
The idea that unifies and explains these disparate initiatives is the
theology of microfinance. It is hard to overstate the attraction of this
magical idea to the liberal class, or at least to that part of it working in
the foreign-aid sector. Micro¬lending, such people have come to believe over
the past few decades, was the magic elixir for sexism and poverty, the
financial innovation that would save the Third World. Foundations embraced
it. Careers were built on it. Billions were spent advancing it. The United
Nations declared 2005 the International Year of Microcredit. Muhammad Yunus,
the Bangladeshi economist who popularized microlending, won a Nobel Prize in
2006. Three years later, Barack Obama gave Yunus the Presidential Medal of
Freedom.
And it was all so simple. While national leaders busied themselves with the
macro-matters of privatizing and deregulating, microloans would bring the
science of markets down to the individual. Merely by providing impoverished
individuals with a tiny loan of fifty or a hundred dollars, it was thought,
you could put them on the road to entrepreneurial self-sufficiency, you
could make entire countries prosper, you could bring about economic
development itself.
What was most attractive about micro¬lending was what it was not, what it
made unnecessary: any sort of collective action by poor people coming
together in governments or unions. The international development community
now knew that such institutions had no real role in human prosperity.
Instead, we were to understand poverty in the familiar terms of
entrepreneurship and individual merit, as though the hard work of millions
of single, unconnected peopleplus cell phones, bank accounts, and a little
capitalwas what was required to remedy the Third Worlds vast problems.
Millions of people would sell one another baskets they had made, or coal
they had dug out of the trash heap, and suddenly they were entrepreneurs,
racing to the top. The key to development was not doing something to limit
the grasp of Western banks, in other words; it was extending Western banking
methods to encompass every last individual on earth.
Microlending is a perfect expression of Clintonism, since it brings together
wealthy financial interests with rhetoric that sounds outrageously
idealistic. Microlending permits all manner of networking, posturing, and
profit taking among the lenders while doing nothing to change actual power
relationsthe ultimate win-win.
Back in the 1990s, Bill Clintons administration had made microloans a proud
point of emphasis in U.S. foreign policy, and Hillary has been a
micro¬lending enthusiast since her first days on the national stage. She
promoted it as a form of female empowerment in a famous 1995 speech she made
in Beijing, and she supported micro¬lending efforts wherever the First
Family traveled in the 1990stheres an exhibit on the subject at the
Clinton Presidential Library that shows Hillary giving a speech in the Gaza
Strip in front of a sign that reads, WOMENS EMPOWERMENT THROUGH
MICRO-LENDING. In 1997 she cochaired a global Microcredit Summit in
Washington, D.C., replete with the usual Third World delegations. Hillarys
own remarks on that occasion were unremarkable, but those of the president
of the Citi¬corp Foundation were well worth remembering. Here is what he
said to the assembled saviors of the Third World: Everyone in this room is
a banker, because everyone here is banking on self-employment to help
alleviate poverty around the world. At the closing session of the summit,
bankers joined national leaders in singing We Shall Overcome.
In the decade that followed, the theology of microlending developed a number
of doctrinal refinements. There was the idea that women were better
borrowers and better entrepreneurs than men; the belief that poor people
needed mentorship and financial inclusion in addition to loans; the
suggestion that they had to be hooked up to a bank via the Internet; the
discovery that it was morally okay to run microlending banks as private,
profit-making enterprisesmany of the arguments that I had heard at the No
Ceilings conference, expressed in the unforgettable tones of international
female solidarity.
These ideas made up the core of the Hillary Doctrine. Melanne Verveer, her
ambassador-at-large for global womens issues, declared in 2011 that
financial inclusion is a top priority for the U.S. government and
announced her terrible chagrin that three billion people in the world
remain unbanked; the majority of them are women. Hillarys under¬secretary
for democracy and global affairs, Maria Otero, came to State from one of the
biggest American micro¬lending institutions, ACCION International. Now, in
her official government capacity, she expressed her joy at how microfinance
had evolved from subsidized microloans to a focus on self-sufficiency, to
an emphasis on savings, to a full suite of financial products delivered by
commercial regulated banksand how all this had affirmed the capacity of
the poor to become economic actors in their own right. Hillary herself
proudly recalls in her memoirs how the State Department rebuilt Afghanistan
by handing out more than 100,000 small personal loans to the women of that
country.
These are fine, sterling sentiments. They suffer, however, from one big
problem: microlending doesnt work. As strategies for ending poverty go,
micro¬lending appears to be among the worst that has ever been tried, just
one step up from doing nothing at all to help the poor. In a carefully
researched 2010 book called Why Doesnt Micro¬finance Work? the development
consultant Milford Bateman debunks virtually every aspect of the microloan
gospel. Microlending doesnt empower women, Bateman writesinstead, it makes
them into debtors. It encourages people to take up small, futile enterprises
that have no chance of growing or employing others. Sometimes
micro¬borrowers dont even start businesses at all; they just spend the loan
on whatever. Even worse: the expert studies that originally sparked the
micro¬lending boom turn out, upon reexamination, to have been badly flawed.
Nearly every country where microlending has been an important development
strategy for the past few decades, Bateman writes, is now a disaster zone of
indebtedness and economic backwardness. When he tells us that the
increasing dominance of the microfinance model in developing countries is
causally associated with their progressive deindustrialization and
infantilization, he is being polite. The terrible implication of the facts
he has uncovered is that microlending achieves the opposite of development.
Even Soviet-style Communism, with its frequently mocked Five Year Plans,
worked better than this strategy does, as Bateman shows in a tragic look at
microloan-saturated Bosnia.
No matter. The liberal class is unlikely to abandon its romance with
micro¬finance, for yet another reason: it is profitable. Lending to the
poor, as every subprime-mortgage originator knows, can be a lucrative
business. Mixed with international feminist self-righteousness, it is also a
bulletproof business, immune to criticism. Naturally the international
goodness community discovered that empowering poor women by lending to them
at usurious interest rates was a fine thing all around.
Other virtue quests have proven just as attractive. Companies needing a
stiff shot of P.R. whitewash fell over one another to enlist in the State
Departments crusade to build solutions for good. Goldman Sachs partnered
with the State Department in 2011 to give out business-school scholarships
to women entrepreneurs from the developing world. The following year,
Clintons old friends at the wage-crushing retailer Walmart announced a $1.5
million gift to the departments Womens Entrepreneurship in the Americas
program. (The effort will support the dreams of up to 55,000 potential
women entrepreneurs, the company boasted.) ExxonMobil was on board, too,
helping State to register women-owned businesses in Mexico.
The figure of the female Third World entrepreneur, rescued from her
unbanked state by Wall Streetbacked organizations, mentored by her
friends in the American professional class, expressing herself through
social media, remains to this day among the most cherished daydreams in the
land of money. Everyone is infatuated with her: the foundations, the State
Department, the corporations. Everyone wants to have his picture taken with
her. Everyone wants to partner with everyone else to advance her interests
and loan her money.
The fantasies blend seamlessly one into another. The ideas promoted by
Goldman Sachss 10,000 Women project, for example, are not really different
from those of Hillarys own Vital Voices Global Partnership, or Coca-Colas
#5by20 initiative, or even the conscientious statements you find in State
Department press releases. People move from one node of this right-thinking
world to another and no one really notices, because the relocation signifies
no meaningful change. They give one another grants and prizes and endowed
chairs; they extol one anothers ideas and books; they appear together with
their banker pals on panel discussions in Bali or maybe Davos; and they all
come together to fix Haiti, and then to fix Haiti again, and then to fix
Haiti yet again.
Hillary herself moved in this fashion from State to the Clinton Foundation,
where she presided over a dizzying program of awards for the usual people,
grants for some genuinely good causes, and the organizing of great
spectacles of virtue like the one I attended in New York, a costly
praiseorama featuring many of the very same people who worked for her in
government.
What I concluded from observing all this is that there is a global commerce
in compassion, an international virtue circuit featuring people of
unquestionable moral achievement: Archbishop Tutu, Bono, Sting, Yunus,
Angelina Jolie. They travel the world, collecting and radiating goodness.
And in doing so, they come into contact with the other participants in the
same market: the politicians and billionaires and bankers, who warm
themselves with the incandescent virtue of the world-traveling moral
superstars.
But lets be clear. What drives this market are the buyers. Like Walmart and
Goldman Sachs locking arms with the State Department, what these
virtue-consumers are doing is purchasing liberalism offsets, an ideological
version of the carbon offsets that polluters sometimes buy in order to
compensate for the smog they churn out.
And at the apex of all this idealism stands the Clinton Foundation, a
veritable market-maker in the worlds vast, swirling virtue trade. The
former president who runs the whole show is the worlds leading
philanthropic deal¬maker, according to a book on the subject. Under his
watchful eye, all the concerned parties are brought together: the moral
superstars, the billionaires, and of course the professionals, who organize,
intone, and advise. Virtue changes hands. Good causes are funded. Compassion
is radiated and absorbed.
This is modern liberalism in action: an unregulated virtue exchange in which
representatives of one class of humanity ritually forgive the sins of
another class, all of it convened and facilitated by a vast army of
well-credentialed American technocrats, while the objects of their high and
noble compassion sink slowly back into a preindustrial state.
One of the motifs of that Clinton Foundation event I attended in 2015 was
the phrase NOT THERE, a reference to the women who arent present in the
councils of state or the senior management of powerful corporations. The
foundation raised awareness of this problem by producing visuals in which
fashion models disappeared from the covers of popular magazines like Vogue,
Glamour, SELF, and Allure. According to a New York Times story on the
subject, the Clinton people had gone to a hip advertising agency to develop
this concept, so that we would all understand that women were missing from
the high-ranking places where they deserved to be.
There was also another act of erasure going on here, but no clever adman
will ever be hired to play it up. International Womens Day, I discovered,
began as a socialist holiday, a sort of second Labor Day, on which you were
supposed to commemorate the efforts of female workers and the sacrifices of
female strikers. It is a vestige of an old form of feminism that didnt
especially focus on the problems experienced by women trying to be corporate
officers or the views of some megabillionaires wife.
What we were there in New York to consider, among other things, was how
unjust it was that women were underrepresented in the C-suites of the
Fortune 500and, by implication, how lamentable it was that the United
States had not yet elected a woman president. There was no considerationI
mean, zeroof the situation of women who work on the shop floors of the
Fortune 500for Walmart or Amazon or any of the countless low-wage employers
who make that list sparkle. Working-class American women were simply
not
there. In this festival of inclusiveness and affirmation, their problems
were not considered, their voices were not heard.
Hillary Clinton is not a callous or haughty woman. She has much to recommend
her for the nations highest office: for one thing, her knowledge of
Washington; for another, the Republican vendetta against her, which is so
vindictive and so unfair that I myself might vote for her in November just
to show what I think of it. And she has, after all, made a great effort in
the course of the past year to impress voters with her feelings for working
people.
But its hard, given her record, not to feel that this was only under
perceived pressure from her primary opponent, Senator Bernie Sanders. Absent
such political force, Hillary tends to gravitate back to a version of
feminism that is mainly concerned with the struggle of professional women to
rise as high as their talents will take them. No ceilings.
As I sat there in the Best Buy Theater, however, I kept thinking about the
infinitely greater problem of no floors. On the train to New York that
morning I had been reading a book by Peter Edelman, one of the countrys
leading experts on welfare and a longtime friend of the Clintons. Edelmans
aim was to document the effect that the Clintons welfare-reform measure had
on poor peoplespecifically on poor women, because thats who used to
receive welfare payments in the days before the program was reformed and
turned over to stingy state governments.
2 Hillary Clinton describes her role in the welfare-reform debate in her
2003 book, Living History. The old AFDC welfare arrangement, she writes,
had helped to create generations of welfare-dependent Americans
I strongly
argued that we had to change the system, although my endorsement of welfare
reform came at some personal cost. She then recounts how the Republicans in
Congress passed two versions of welfare reform that she found too punitive,
but that their third try was acceptable. Bill Clinton signed this third
version. Even with its flaws, Hillary continues, this bill was a critical
first step to reforming our nations welfare system. I agreed that he should
sign it and worked hard to round up votes for its passagethough he and the
legislation were roundly criticized by some liberals, advocacy groups for
immigrants and most people who worked with the welfare system.
Edelman was not a fan of the old, pre-1996 welfare system, because it did
nothing to prepare women for employment or to solve the problem of day care.
But under the old system, at least our society had a legal obligation to do
something for these people, the weakest and most vulnerable among us. Today,
thanks to Hillary and her husband, that obligation has been canceled, and we
do very little.2 The result, Edelman maintains, has been exactly what youd
expect: extreme poverty has increased dramatically in this country since
Bill Clinton signed welfare reform in 1996.
For poor and working-class American women, the floor was pulled up and
hauled off to the landfill some twenty years ago. There is no State
Department somewhere to pay for their cell phones or to pick up their
day-care expenses. And one of the people who helped to work this deed was
the very woman I watched present herself as the champion of the worlds
downtrodden femininity.
Sitting there in gilded Manhattan, I thought of all the abandoned factories
and postindustrial desolation in the surrounding regions, and I mused on
how, in such places, the Democratic establishment was receding into terminal
insignificance. It had virtually nothing to say to the people who inhabit
that land of waste and futility.
But for the faithful liberals at the Clinton Foundation gathering in New
York, none of that mattered. The partys deficit in relevance to average
citizens was more than made up by its massive surplus in moral virtue. Here,
inside the theater, the big foundations and the great fashion magazines were
staging a pageant of goodness unquestionable, and the liberal class was
swimming happily in its home element.
They knew which things were necessary to make up a liberal movement, and all
of the ingredients were present: well-meaning billionaires; grant makers and
grant recipients; Hollywood stars who talked about social media; female
entrepreneurs from the Third World; and, of course, an audience of hundreds,
who clapped and cheered enthusiastically every time one of their
well-graduated leaders wandered across the stage. The performance of
liberalism was so realistic one could almost believe it lived.
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February 23, 2016: [Guantánamo][Nevada][Apple][Geronimo]
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Online Exclusive February 19, 2016, 11:06 am
Nor a Lender Be
Hillary Clinton, liberal virtue, and the cult of the microloan
By Thomas Frank
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An exclusive first look at Thomas Franks new book Listen, Liberal! which
will be published next month by Metropolitan Books. Frank wrote the Easy
Chair column for Harpers Magazine from 2010 to 2014.
The day after International Womens Day in March 2015, I attended a Clinton
Foundation production put on by its No Ceilings initiative at the Best Buy
Theater in New York City. It wasnt a campaign eventthe 2016 race had not
really started at that pointnor was it a panel discussion, as there were no
disagreements among the participants or questions from the audience.
Instead, it was a choreographed presentation of various findings having to
do with womens standing in the world. But if you paid attention, the event
provided a way to understand Hillary Clintons real views on the great
social question before the nationthe problem of income inequality.
Onto the stage before us came former secretary of state Clinton, the
Democratic Partys heir apparent; Melinda Gates, the wife of the richest man
in the world (the event was produced with the Bill & Melinda Gates
Foundation); various NGO executives; a Hollywood celebrity; a Silicon Valley
CEO; a best-selling author; an expert in womens issues from Georgetown
University; a Nobel Prize winner; and a large supporting cast of women from
the Third World. Everyone strode with polished informality about the stage,
reading their lines from an invisible teleprompter. And back and forth, the
presenters called out to one another in tones of supportiveness and sweet
flattery.
In her introduction to the event, for example, the TV star America Ferrera,
who has appeared at many Clinton events both philanthropic and political,
gave a shout-out to the incredible women who have brought us all here
today and the amazing girls whose conversation she had been permitted to
join. Then Chelsea Clinton, who announced herself completely awed by the
incredible swell of people and partners who had participated in some event
the previous day, invited us to hearken to the inspiring voices of leaders,
of communities, of companies, of countries.
Those were just the first few minutes. It kept on like that for hours. When
someones potential was mentioned, it was described as boundless.
Peoples stories were compelling when they werent inspiring,
incredible, or incredibly inspiring. A Kenyan activist was introduced as
the incomparable.
But the real star of this show was the Creative Innovator, the figure who
crops up whenever the liberal class gets together to talk about spreading
the prosperity around more fairly. In this case, the innovations being
hailed seemed mainly to be transpiring in the Third World. Every year,
millions and millions of women everywhere are empowering themselves and
their communities by finding unique, dynamic, and productive ways to enter
the workforce, start their own businesses, and contribute to their economies
and their countries, said Chelsea Clinton, introducing an inspiring
innovator and chocolatier from Trinidad.
Melinda Gates followed up the chocolatiers presentation by heaping even
more praise: She is an amazing businesswoman, you can see why we all find
her so inspiring. Then, a little later on: Entrepreneurship is really
vital for women
. Its also their ability to advance into leadership roles
into corporations. And corporations play such a big role in the global
economy.
Roughly speaking, there were two groups present at this distinctly First
World gathering. Many of the people making presentations came from Third
World countriesa midwife from Haiti, a student from Afghanistan, the
chocolate maker from Trinidad, a former child bride from India, an
environmental activist from Kenyawhile the women anchoring this swirling
praise fest were former secretary of state Hillary Clinton and the wealthy
foundation executive Melinda Gates.
What this lineup suggested is that there is a kind of naturally occurring
solidarity between the millions of women at the bottom of the worlds
pyramid and the tiny handful of women at its very top. The hardship those
Third World women have endured and the entrepreneurial efforts they have
undertaken are powerful symbols of the struggle of American professional
women to become CEOs of Fortune 500 companies (one of the ambitions that was
discussed in detail) or of a woman to be elected president, which was the
unspoken theme of the entire event.
What the spectacle had to offer ordinary working American women was another
story.
That was my first experience of the microclimate of goodness that always
seems to surround Hillary Rodham Clinton. The mystic bond between
high-achieving American professionals and the planets most victimized
people, I would discover, is a recurring theme in her life and work.
But it is not her theme alone. Regardless of who leads it,
professional-class liberalism seems to be forever traveling on a quest for
some place of greater righteousness. It is always engaged in a search for
some subject of overwhelming, noncontroversial goodness with which it can
identify itself, and under whose umbrella of virtue it can put across its
self-interested class program.
There have been many other virtue objects over the years, people and ideas
whose surplus righteousness could be extracted for deployment elsewhere. The
great virtue-rush of the 1990s, for example, was focused on children, then
thought to be the last word in overwhelming, noncontroversial goodness. Who
could be against kids? No one, of course, and so the race was on to justify
in their name whatever your program happened to be. In the course of Hillary
Clintons 1996 book, It Takes a Village, for example, this favorite
rationale of the daythink of the children!was deployed to explain her
husbands draconian crime bill as well as more directly child-related causes
such as charter schools.
1 I am taking Democrats to task here, but of course Republicans do it too.
The culture wars unfold in precisely the same way as the liberal
virtue-quest: they are an exciting ersatz politics that seem to be really
important but at the conclusion of which voters discover theyve got little
to show for it all besides more free-trade agreements, more bank
deregulation, and a different prison-building spree.
You can find dozens of examples of this kind of liberal-class virtue quest
if you try, but instead of listing them, let me go straight to the point:
this is not politics. Its an imitation of politics. It feels political,
yes: its highly moralistic, it sets up an easy melodrama of good versus
bad, it allows you to make all kinds of judgments about people you disagree
with. But ultimately its a diversion, a way of putting across a policy
program while avoiding any sincere discussion of the policies in question.
The virtue quest is an exciting moral crusade that seems to be extremely
important but at the conclusion of which you discover youve got little to
show for it besides NAFTA, bank deregulation, and a prison-building spree.1
For all that, the Clinton Foundation event I attended gives us a context in
which to understand Hillarys most important moment as a maker of policyher
four years as Barack Obamas secretary of state. Although her purview then
was foreign policy, we can see from her deeds at State how she intends to
tackle the great economic question of our time. The themes will be familiar
to anyone who follows Democratic politics closely. She cast herself as a
high-minded ally of Silicon Valley. She enshrined a version of feminism in
which liberation is, in part, a matter of taking out loans from banks in
order to become an entrepreneur. And between these two doctrines, it seems
clear that income inequality has little role in the grand sweep of her
political career.
In emphasizing these aspects of her tenure at the State Department, I do not
mean to brush off the conventional diplomatic triumphs that Hillary Clinton
engineered, like the international effort to isolate Iran. Nor do I mean to
soft-pedal her conventional diplomatic failures, like the cataclysmic civil
war in Libya, a conflict Clinton worked so hard to stoke that the Washington
Post in 2011 called it Hillarys War. But I want to focus for a moment on
one of her early initiatives as secretary of state: something she called
Internet Freedom. This was to be the very cornerstone of the 21st century
statecraft policy agenda, according to the State Department, and Clinton
returned to the principle frequently. In a high-profile speech in January
2010, she declared that, henceforth, the United States would stand for a
single Internet where all of humanity has equal access to knowledge and
ideas. Committing ourselves to defending this unified Internet from all who
would censor it, she continued, was a logical extension of what Franklin
Roosevelt had been after with his Four Freedoms; it wasnt all that much
different from the U.N.s Universal Declaration of Human Rights either.
Now, understanding the Internet as a force of pure nobility is a pundit
tradition in the United States, and in the days when Clinton declared
humanitys Internet Freedom, those ideals were on the lips of every
commentator. In the summer of 2009, the Iranian regime had violently
suppressed a series of enormous street protestsprotests that, the American
pundit community immediately determined, were as much a testament to the
power of Twitter as they were about any local grievance having to do with
Iran itself. The so called Twitter Revolution fit neatly into the beloved
idea that new communications technologiestechnologies invented or dominated
by Americans, that ismilitate by their very nature against dictatorships, a
market-populist article of faith shared everywhere from Wall Street to
Silicon Valley.
Then there was the economic side of the single, unified Internet, and it,
too, was all about liberation. For the people at the bottom of the worlds
economic ladder, Hillary Clinton averred on that day in 2010, the Internet
was a savior. She knew of farmers in Kenya who were using mobile banking
technology, and of women entrepreneurs somewhere else in Africa who were
getting microcredit loans, and of a doctor who used a search engine to
diagnose a disease. I guess she hadnt heard about what these same
technologies were doing to the livelihoods of journalists or musicians or
taxi drivers in her own country, but I quibble; as long as this technology
was free, anyone could see that it pushed in one direction only, and that
was up.
Clintons other great initiative during her State Department days was the
so-called Hillary Doctrine: the recasting of the United States as the
worlds defender of women and girls. Now, here was a virtue quest of the
most principled kind. The single remaining superpower was no longer to be an
overbearing hegemon or a bringer of global financial crisisit was actually
determined to improve life for half of the planets population.
The secretary described the elements of the Hillary Doctrine in 2010 at a
TEDWomen conference, that great agora of the liberal class. I have made
clear that the rights and the roles of women and girls will be a central
tenet of American foreign policy, she said, because where girls and women
flourish, our values are also reflected. It was, Clinton continued, in the
vital interests of the United States of America to care about women and
girls. Her reasoning: the subjugation of women is a threat to the common
security of our world and to the national security of our country.
I was a little bit alarmed when I heard Secretary Clinton speak these
phrases in her deliberate way. Ordinarily, the words vital interest and
national security, when combined like this, suggest strong stuff: that the
United States has a right to freeze assets, organize embargoes, and maybe
even launch air strikesin this case, I suppose, against countries that
score poorly on the gender-equality scale.
Not to worry. Like so many high-minded Democratic virtue quests, this one
turned out to be largely concerned with the personal, with foundations and
private companies that would partner with the United States to do things
like improve maternal and child health, close the global gender gap in
cellular-phone ownership, persuade men and boys to value their sisters and
their daughters, and make sure that every girl in the world has a chance
to live up to her own dreams and aspirations.
The idea that unifies and explains these disparate initiatives is the
theology of microfinance. It is hard to overstate the attraction of this
magical idea to the liberal class, or at least to that part of it working in
the foreign-aid sector. Microlending, such people have come to believe over
the past few decades, was the magic elixir for sexism and poverty, the
financial innovation that would save the Third World. Foundations embraced
it. Careers were built on it. Billions were spent advancing it. The United
Nations declared 2005 the International Year of Microcredit. Muhammad Yunus,
the Bangladeshi economist who popularized microlending, won a Nobel Prize in
2006. Three years later, Barack Obama gave Yunus the Presidential Medal of
Freedom.
And it was all so simple. While national leaders busied themselves with the
macro-matters of privatizing and deregulating, microloans would bring the
science of markets down to the individual. Merely by providing impoverished
individuals with a tiny loan of fifty or a hundred dollars, it was thought,
you could put them on the road to entrepreneurial self-sufficiency, you
could make entire countries prosper, you could bring about economic
development itself.
What was most attractive about microlending was what it was not, what it
made unnecessary: any sort of collective action by poor people coming
together in governments or unions. The international development community
now knew that such institutions had no real role in human prosperity.
Instead, we were to understand poverty in the familiar terms of
entrepreneurship and individual merit, as though the hard work of millions
of single, unconnected peopleplus cell phones, bank accounts, and a little
capitalwas what was required to remedy the Third Worlds vast problems.
Millions of people would sell one another baskets they had made, or coal
they had dug out of the trash heap, and suddenly they were entrepreneurs,
racing to the top. The key to development was not doing something to limit
the grasp of Western banks, in other words; it was extending Western banking
methods to encompass every last individual on earth.
Microlending is a perfect expression of Clintonism, since it brings together
wealthy financial interests with rhetoric that sounds outrageously
idealistic. Microlending permits all manner of networking, posturing, and
profit taking among the lenders while doing nothing to change actual power
relationsthe ultimate win-win.
Back in the 1990s, Bill Clintons administration had made microloans a proud
point of emphasis in U.S. foreign policy, and Hillary has been a
microlending enthusiast since her first days on the national stage. She
promoted it as a form of female empowerment in a famous 1995 speech she made
in Beijing, and she supported microlending efforts wherever the First
Family traveled in the 1990stheres an exhibit on the subject at the
Clinton Presidential Library that shows Hillary giving a speech in the Gaza
Strip in front of a sign that reads, womens empowerment through
micro-lending. In 1997 she cochaired a global Microcredit Summit in
Washington, D.C., replete with the usual Third World delegations. Hillarys
own remarks on that occasion were unremarkable, but those of the president
of the Citicorp Foundation were well worth remembering. Here is what he
said to the assembled saviors of the Third World: Everyone in this room is
a banker, because everyone here is banking on self-employment to help
alleviate poverty around the world. At the closing session of the summit,
bankers joined national leaders in singing We Shall Overcome.
In the decade that followed, the theology of microlending developed a number
of doctrinal refinements. There was the idea that women were better
borrowers and better entrepreneurs than men; the belief that poor people
needed mentorship and financial inclusion in addition to loans; the
suggestion that they had to be hooked up to a bank via the Internet; the
discovery that it was morally okay to run microlending banks as private,
profit-making enterprisesmany of the arguments that I had heard at the No
Ceilings conference, expressed in the unforgettable tones of international
female solidarity.
These ideas made up the core of the Hillary Doctrine. Melanne Verveer, her
ambassador-at-large for global womens issues, declared in 2011 that
financial inclusion is a top priority for the U.S. government and
announced her terrible chagrin that three billion people in the world
remain unbanked; the majority of them are women. Hillarys undersecretary
for democracy and global affairs, Maria Otero, came to State from one of the
biggest American microlending institutions, ACCION International. Now, in
her official government capacity, she expressed her joy at how microfinance
had evolved from subsidized microloans to a focus on self-sufficiency, to
an emphasis on savings, to a full suite of financial products delivered by
commercial regulated banksand how all this had affirmed the capacity of
the poor to become economic actors in their own right. Hillary herself
proudly recalls in her memoirs how the State Department rebuilt Afghanistan
by handing out more than 100,000 small personal loans to the women of that
country.
These are fine, sterling sentiments. They suffer, however, from one big
problem: microlending doesnt work. As strategies for ending poverty go,
microlending appears to be among the worst that has ever been tried, just
one step up from doing nothing at all to help the poor. In a carefully
researched 2010 book called Why Doesnt Microfinance Work? the development
consultant Milford Bateman debunks virtually every aspect of the microloan
gospel. Microlending doesnt empower women, Bateman writesinstead, it makes
them into debtors. It encourages people to take up small, futile enterprises
that have no chance of growing or employing others. Sometimes
microborrowers dont even start businesses at all; they just spend the loan
on whatever. Even worse: the expert studies that originally sparked the
microlending boom turn out, upon reexamination, to have been badly flawed.
Nearly every country where microlending has been an important development
strategy for the past few decades, Bateman writes, is now a disaster zone of
indebtedness and economic backwardness. When he tells us that the
increasing dominance of the microfinance model in developing countries is
causally associated with their progressive deindustrialization and
infantilization, he is being polite. The terrible implication of the facts
he has uncovered is that microlending achieves the opposite of development.
Even Soviet-style Communism, with its frequently mocked Five Year Plans,
worked better than this strategy does, as Bateman shows in a tragic look at
microloan-saturated Bosnia.
No matter. The liberal class is unlikely to abandon its romance with
microfinance, for yet another reason: it is profitable. Lending to the
poor, as every subprime-mortgage originator knows, can be a lucrative
business. Mixed with international feminist self-righteousness, it is also a
bulletproof business, immune to criticism. Naturally the international
goodness community discovered that empowering poor women by lending to them
at usurious interest rates was a fine thing all around.
Other virtue quests have proven just as attractive. Companies needing a
stiff shot of P.R. whitewash fell over one another to enlist in the State
Departments crusade to build solutions for good. Goldman Sachs partnered
with the State Department in 2011 to give out business-school scholarships
to women entrepreneurs from the developing world. The following year,
Clintons old friends at the wage-crushing retailer Walmart announced a $1.5
million gift to the departments Womens Entrepreneurship in the Americas
program. (The effort will support the dreams of up to 55,000 potential
women entrepreneurs, the company boasted.) ExxonMobil was on board, too,
helping State to register women-owned businesses in Mexico.
The figure of the female Third World entrepreneur, rescued from her
unbanked state by Wall Streetbacked organizations, mentored by her
friends in the American professional class, expressing herself through
social media, remains to this day among the most cherished daydreams in the
land of money. Everyone is infatuated with her: the foundations, the State
Department, the corporations. Everyone wants to have his picture taken with
her. Everyone wants to partner with everyone else to advance her interests
and loan her money.
The fantasies blend seamlessly one into another. The ideas promoted by
Goldman Sachss 10,000 Women project, for example, are not really different
from those of Hillarys own Vital Voices Global Partnership, or Coca-Colas
#5by20 initiative, or even the conscientious statements you find in State
Department press releases. People move from one node of this right-thinking
world to another and no one really notices, because the relocation signifies
no meaningful change. They give one another grants and prizes and endowed
chairs; they extol one anothers ideas and books; they appear together with
their banker pals on panel discussions in Bali or maybe Davos; and they all
come together to fix Haiti, and then to fix Haiti again, and then to fix
Haiti yet again.
Hillary herself moved in this fashion from State to the Clinton Foundation,
where she presided over a dizzying program of awards for the usual people,
grants for some genuinely good causes, and the organizing of great
spectacles of virtue like the one I attended in New York, a costly
praiseorama featuring many of the very same people who worked for her in
government.
What I concluded from observing all this is that there is a global commerce
in compassion, an international virtue circuit featuring people of
unquestionable moral achievement: Archbishop Tutu, Bono, Sting, Yunus,
Angelina Jolie. They travel the world, collecting and radiating goodness.
And in doing so, they come into contact with the other participants in the
same market: the politicians and billionaires and bankers, who warm
themselves with the incandescent virtue of the world-traveling moral
superstars.
But lets be clear. What drives this market are the buyers. Like Walmart and
Goldman Sachs locking arms with the State Department, what these
virtue-consumers are doing is purchasing liberalism offsets, an ideological
version of the carbon offsets that polluters sometimes buy in order to
compensate for the smog they churn out.
And at the apex of all this idealism stands the Clinton Foundation, a
veritable market-maker in the worlds vast, swirling virtue trade. The
former president who runs the whole show is the worlds leading
philanthropic dealmaker, according to a book on the subject. Under his
watchful eye, all the concerned parties are brought together: the moral
superstars, the billionaires, and of course the professionals, who organize,
intone, and advise. Virtue changes hands. Good causes are funded. Compassion
is radiated and absorbed.
This is modern liberalism in action: an unregulated virtue exchange in which
representatives of one class of humanity ritually forgive the sins of
another class, all of it convened and facilitated by a vast army of
well-credentialed American technocrats, while the objects of their high and
noble compassion sink slowly back into a preindustrial state.
One of the motifs of that Clinton Foundation event I attended in 2015 was
the phrase not there, a reference to the women who arent present in the
councils of state or the senior management of powerful corporations. The
foundation raised awareness of this problem by producing visuals in which
fashion models disappeared from the covers of popular magazines like Vogue,
Glamour, SELF, and Allure. According to a New York Times story on the
subject, the Clinton people had gone to a hip advertising agency to develop
this concept, so that we would all understand that women were missing from
the high-ranking places where they deserved to be.
There was also another act of erasure going on here, but no clever adman
will ever be hired to play it up. International Womens Day, I discovered,
began as a socialist holiday, a sort of second Labor Day, on which you were
supposed to commemorate the efforts of female workers and the sacrifices of
female strikers. It is a vestige of an old form of feminism that didnt
especially focus on the problems experienced by women trying to be corporate
officers or the views of some megabillionaires wife.
What we were there in New York to consider, among other things, was how
unjust it was that women were underrepresented in the C-suites of the
Fortune 500and, by implication, how lamentable it was that the United
States had not yet elected a woman president. There was no considerationI
mean, zeroof the situation of women who work on the shop floors of the
Fortune 500for Walmart or Amazon or any of the countless low-wage employers
who make that list sparkle. Working-class American women were simply
not
there. In this festival of inclusiveness and affirmation, their problems
were not considered, their voices were not heard.
Hillary Clinton is not a callous or haughty woman. She has much to recommend
her for the nations highest office: for one thing, her knowledge of
Washington; for another, the Republican vendetta against her, which is so
vindictive and so unfair that I myself might vote for her in November just
to show what I think of it. And she has, after all, made a great effort in
the course of the past year to impress voters with her feelings for working
people.
But its hard, given her record, not to feel that this was only under
perceived pressure from her primary opponent, Senator Bernie Sanders. Absent
such political force, Hillary tends to gravitate back to a version of
feminism that is mainly concerned with the struggle of professional women to
rise as high as their talents will take them. No ceilings.
As I sat there in the Best Buy Theater, however, I kept thinking about the
infinitely greater problem of no floors. On the train to New York that
morning I had been reading a book by Peter Edelman, one of the countrys
leading experts on welfare and a longtime friend of the Clintons. Edelmans
aim was to document the effect that the Clintons welfare-reform measure had
on poor peoplespecifically on poor women, because thats who used to
receive welfare payments in the days before the program was reformed and
turned over to stingy state governments.
2 Hillary Clinton describes her role in the welfare-reform debate in her
2003 book, Living History. The old AFDC welfare arrangement, she writes,
had helped to create generations of welfare-dependent Americans
I strongly
argued that we had to change the system, although my endorsement of welfare
reform came at some personal cost. She then recounts how the Republicans in
Congress passed two versions of welfare reform that she found too punitive,
but that their third try was acceptable. Bill Clinton signed this third
version. Even with its flaws, Hillary continues, this bill was a critical
first step to reforming our nations welfare system. I agreed that he should
sign it and worked hard to round up votes for its passagethough he and the
legislation were roundly criticized by some liberals, advocacy groups for
immigrants and most people who worked with the welfare system.
Edelman was not a fan of the old, pre-1996 welfare system, because it did
nothing to prepare women for employment or to solve the problem of day care.
But under the old system, at least our society had a legal obligation to do
something for these people, the weakest and most vulnerable among us. Today,
thanks to Hillary and her husband, that obligation has been canceled, and we
do very little.2 The result, Edelman maintains, has been exactly what youd
expect: extreme poverty has increased dramatically in this country since
Bill Clinton signed welfare reform in 1996.
For poor and working-class American women, the floor was pulled up and
hauled off to the landfill some twenty years ago. There is no State
Department somewhere to pay for their cell phones or to pick up their
day-care expenses. And one of the people who helped to work this deed was
the very woman I watched present herself as the champion of the worlds
downtrodden femininity.
Sitting there in gilded Manhattan, I thought of all the abandoned factories
and postindustrial desolation in the surrounding regions, and I mused on
how, in such places, the Democratic establishment was receding into terminal
insignificance. It had virtually nothing to say to the people who inhabit
that land of waste and futility.
But for the faithful liberals at the Clinton Foundation gathering in New
York, none of that mattered. The partys deficit in relevance to average
citizens was more than made up by its massive surplus in moral virtue. Here,
inside the theater, the big foundations and the great fashion magazines were
staging a pageant of goodness unquestionable, and the liberal class was
swimming happily in its home element.
They knew which things were necessary to make up a liberal movement, and all
of the ingredients were present: well-meaning billionaires; grant makers and
grant recipients; Hollywood stars who talked about social media; female
entrepreneurs from the Third World; and, of course, an audience of hundreds,
who clapped and cheered enthusiastically every time one of their
well-graduated leaders wandered across the stage. The performance of
liberalism was so realistic one could almost believe it lived.
