by JOHN FEFFER | Tuesday, June 15, 2010
World Beat, FPIF’s weekly ezine
According to the business plan of the 10,000 Women project, an investment of $100 million over five years will create 10,000 female entrepreneurs in the developing world. The money goes to business education – MBAs – for women in the global south who, in turn, are expected to create businesses that employ people and grow the economy.
Forget about “it takes a village to raise a child.” The 10,000 Women approach turns the African proverb on its head. According to this entrepreneurial model, it takes a child (who grows up and gets an MBA) to raise a village.
The notion that a small group of talented people will raise up their community is an old one. The African-American intellectual W.E.B. DuBois, for instance, coined the expression “talented tenth” in a 1903 essay in his volume The Negro Problem. “The Negro race, like all races, is going to be saved by its exceptional men,” DuBois wrote. “The problem of education, then, among Negroes must first of all deal with the Talented Tenth; it is the problem of developing the Best of this race that they may guide the Mass away from the contamination and death of the Worst, in their own and other races.”
Here, in raw form, is an appeal to the elite to turn its talents toward bettering the masses. The entrepreneurial model, while comparably elitist, eschews such moralism. In the cloud-cuckoo-land of the market fundamentalist, the MBA-wielding businesswomen pursue their own self-interest and, through the magic of the market, manage to do good by doing well.This “talented tenth” approach can be found in microfinance as well. Outfits like the Grameen Bank and Kiva provide small loans to women who raise goats, families that run very small businesses, small farmers who need fertilizer. These fledgling entrepreneurs don’t attract the interest of established banks, much less international financial institutions. They borrow small sums of money, grow their businesses, and pay back the loans.
As a narrow strategy – getting credit to poor people who need it – microfinance succeeds admirably. But the larger claims that it can serve as a development strategy is at best questionable. The French economist Esther Duflo has worked hard to develop techniques to assess public policies much as medical researchers test drugs: through randomized control trials. Her team published a report on microfinance that concluded that the technique didn’t increase average consumption, improve levels of education, or boost women’s decision-making. “Duflo’s work has convinced her that the absence of a steady job is what is most likely to be preventing a person in poverty from having an easier life,” writes Ian Parker in The New Yorker.
This criticism goes to the heart of the entrepreneurial “talented tenth” approach. Investing in people is a fine slogan. But it ignores the importance of infrastructure (roads, public transportation, fiberoptic cables), a health care system that sustains a population, and a robust public sector that provides secure jobs. It’s not so easy to squeeze money out of donors by showing them a picture of an irrigation system. The “sponsor-an-entrepreneur” strategy is doing for development what the “sponsor-a-child” strategy did for the Christian Children’s Fund.
In many ways, the 10,000 Women project is the flip side of the corporate remuneration scheme. The “talented tenth” of the corporate world receive enormous bonuses for their putative contributions to the firm. These “exceptional men” – and most of them tend to be men, just as they were in the days of DuBois – pull up the performance and the standards of the rest of their colleagues.
Or do they? The 10,000 Women project, it should be noted, is the brainchild of Goldman Sachs. In April, firm representatives faced charges in front of the Senate that they not only helped precipitate the financial meltdown, but deliberately profited by it. In the hot glare of media attention and public outrage, even Republicans deserted the firm. “There is something unseemly about Goldman betting against the housing market at the same time it is selling to its clients mortgage-backed securities of toxic loans,” Susan Collins (R-ME) said.
The $100 million that Goldman Sachs shells out for the 10,000 Women project is a mere pittance compared to the $16.2 billion in corporate bonuses it distributed in January. Goldman Sachs is translating its backwards strategy from the corporate boardroom to the development world. The result may well be some short-term profit. The MBA-armed women will likely make money, just as “fabulous Fab” Fabrice Tourre, the banker at the heart of the scandal, made a lot of money for Goldman Sachs. But will the 10,000 women actually help the common good?
W.E.B. DuBois ultimately repudiated his “talented tenth” essay. In 1948, he wrote: “When I came out of college into the world of work, I realized that it was quite possible that my plan of training a talented tenth might put in control and power, a group of selfish, self-indulgent, well-to-do men, whose basic interest in solving the Negro problem was personal; personal freedom and unhampered enjoyment and use of the world, without any real care, or certainly no arousing care as to what became of the mass of American Negroes, or of the mass of any people.”
I doubt Goldman Sachs will ever repudiate its own “talented tenth” approach. After all, it is woven into the very texture of the firm and the environment within which it operates. But when will the rest of us wean ourselves of the delusion that a talented tenth – be they entrepreneurs or technocrats or pundits – will deliver us from poverty and the other ills of the world?