Who’s Making the Choices? – A Reply to Hugh Sinclair

The moment of truth in Hugh Sinclair’s post comes in the three-point manifesto for microfinance—particularly in point two, about putting the welfare of clients first.  But this, to my mind, extends to a cultural sensitivity, to avoiding paternalistic soap-boxing about clients’ lives.  From our western standpoint (and I include myself wholeheartedly in this generalization), child labor is, quite simply, bad.  But making a moral judgment about the choices our clients make is, to my mind, denying one of the most compelling reasons for microfinance.  Microfinance, in its best and purest incarnations, respects the poor as individuals with agency, better placed than any outsider to make decisions about their lives.  It is unbelievably arrogant to assume we know better the complexities of poverty and how to escape it, given that we have never and will never be in the positions our clients are in every day.  So condemnations of child labor are not just condemnations of the practices of microfinance institutions, they are founded upon the very paternalistic, over-generalizing assumptions in development that microfinance should avoid.  Merely off the top of my head, I can imagine several scenarios that even from my western perspective make employing your child in a microenterprise a better option.  “Free” schools often are not free, requiring significant outlays of money to purchase school uniforms, and the basic level of education provided (which is often low-quality) may not be useful for students.  Or perhaps the option isn’t school, but is instead someone else’s sweatshop, an alternative I think many would give up for keeping their children close.  And for many girls, the alternative is marriage—I, coming from a western feminist perspective, would prefer young girls to be working with their mothers as independent economic agents and forces of change for their families, rather than married off and having children at what to me seems an incredibly young age.

To my mind, the solution to the problem you present is just the opposite of your suggestion: instead of requiring more costly, overbearing regulation of client microenterprises to ensure they don’t use their children for labor, we reduce the amount of restrictions on the use of loans.  Most of the poor are entrepreneurs by necessity, it has been shown, and microfinance has the potential to make significant differences in the lives of the poor without necessarily forcing them to start microenterprises, such as through consumption smoothing.  Perhaps a loan to cover the upfront costs of school uniforms would do more for the children, but perhaps the client will choose to use the money for something else.  The beauty of microfinance is that it should leave it up to her as an independent adult to make choices about her family’s financial life, secure in the knowledge that she can do so much better than we can.

Laura Dick is a graduating senior at the University of Mary Washington, majoring in economics and anthropology.  Along with the Month of Microfinance, she’s on the Two Dollar Challenge team and is the impact assessment specialist for La Ceiba, a student-run client-centered microfinance institution operating in El Progreso, Honduras.

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