We as citizens of the United States observe politics from afar and the vast majority of us may participate in the political process only to the extent that we go to the polls once a year to vote. We may endeavor to follow the news accounts of our nation's politics as they unfold, and of the consequences those political actions yield, but we have little power to influence our "democratically" elected officials. Perhaps we write an occasional letter to our senator or representative, but we almost inevitably receive a vague and impersonal response explaining why they will vote in our opposition.

Over the decades, our representative democracy has been systematically undermined and has ultimately failed in preserving the well being of the people of this nation. The system that the founding fathers painstakingly devised in order to best serve the interests and the will of the people has been corrupted and the systems of checks and balances on power that they instituted have been stripped away. Most of us accept this reality as being beyond our control and continue to observe, comment, and complain without aspiring to achieving any real change, without any hope of instituting a new system of governance that would instead take directly into account your views, and the views of your neighbors, and would empower you to make real positive change possible in your communities.

This site will attempt to explore in depth the places in the world where people are successfully bringing about that type of change in the face of similar odds, where an alternate form of democracy, which is called participatory or direct democracy, is taking root. Initiative, referendum & recall, community councils, and grassroots organizing are but a few ways in which direct/participatory democracy is achieving great success around the world.

Our system of representative democracy does not admit the voice of the people into congressional halls, the high courts, or the oval office where our rights and our liberties are being sold out from underneath us. Our local leaders and activists in our communities, and even those local elected officials who may have the best of intentions are for the most part powerless to make real positive change happen in our neighborhoods, towns and villages when there is so much corruption from above.

In places like Venezuela, Argentina, Bolivia, Nicaragua, Ecuador, Brazil, South Africa, India, and the Phillipines, new experiments in grass roots community based governance are taking place. There is much to be learned from these and other examples of participatory democracy from around the world when we try to examine how this grass-roots based governance could begin to take root here in our own country in order to alter our political system so that it might better serve the American people.

In the hope that one day we can become a nation working together as a united people practicing true democracy as true equals, we open this forum…


Friday, June 6, 2008

KERALA: An Experiment in Mass Participation

Having posted various articles regarding participatory democracy in India, the tiny state of Kerala somehow escaped our radar until now. It turns out that the heterogeneous population of 32 million has had a unique opportunity to manage public policy and achieve tangible success on the heels of the Panchayathi Raj movement. The following article provides the unique history of development experienced in the region and points out the advantages of mass participation in politics as an example for other "developing" states. -Editor

Kerala's Silent Revolution

Rajaji Mathew Thomas

18 March, 2005


The significance of the tiny Indian state of Kerala’s experience is often underestimated in national and international discussions. One reason for this is that Kerala, not being an independent country, is often missed in policy analysis based on international comparisons. Yet Kerala, with it’s 32 million people, has a larger population than most countries in the world (even Canada), including many from which comparative lessons are often drawn for India, such as Sri Lanka (19 million) or Malaysia (23 million), not to speak of tiny Costa Rica or Singapore (less than 4 million each). Even South Korea, which receives a great deal of attention in the development literature, had about the same population size in the early sixties (when it’s rapid transformation began) as Kerala has today. To achieve as much Kerala has done for a population of it’s size is no mean record in world history.

This is basically because Kerala has been fortunate with it’s past. For one thing, bulk of what is now Kerala used to consist of two ‘native states’-Travancore and Cochin- formally outside British India.

They were not subjected to the general lack of interest of Whitehall officialdom in Indian elementary education (as opposed to higher education). When Rani Gouri Parvathi Bai, the young queen of Travancore, made her pioneering statement in 1817 on the importance of basic education, there was no need to bring that policy initiative in line with what was happening in the rest of India, under the Raj. (The independence from general British Indian policy applied not only to the princely rulers of these states, but also to the British ‘Residents’ in Trivandrum. The Residents could consider independent initiatives, and indeed in the big move in Travancore in the direction of elementary education in the early nineteenth centaury, the Resident Mr. Munro played as extremely supportive – and possibly even catalytic role. There is some evidence that he drafted Parvathi Bai’s 1817 statement, whether or not the initiative was also his.)

Kerala has also been fortunate in having strong social movements that concentrated on educational advancement – along with general emancipation – of the lower castes, and this has been a special feature of left-wing and radical political movements in Kerala. It has also profiled from a tradition of openness to the world, which has included welcoming early Christians (at least from the fourth centaury), Jews (from shortly after the fall of Jerusalem), and Muslims (from the day of early Arab trading, with settlers coming as economic participants rather than as military conquerors). Into this rather receptive environment, the extensive educational efforts of Christian missionaries, particularly in the nineteenth centaury, fitted comfortably. Kerala has also benefited from the matrilineal tradition of property inheritance for an important part of the community in the past. While the Nairs constitute about 20 percent of the total population, and the practice has changed a good deal in recent years, nevertheless the social and political influence of a long tradition of this kind, which goes against the conventional Indian norms, must not be underestimated.

Having good luck in one’s history is not, however, a policy parameter that one can command. Those who see a unique and unrepeatable pattern in Kerala’s remarkable record of social progress can point to the very special nature of it’s past, and suggest that other states can learn rather little from it. This, however, would be quite the wrong conclusion to draw from Kerala’s heterogeneous history. When the state of Kerala was created in independent India, it included not only the erstwhile native states of Travancore and Cochin, but also - on linguistic grounds – the region of Malabar from the old province of Madras in British India (later Tamil Nadu). The Malabar region, transferred from the Raj, was at that time very much behind Travancore and Cochin in terms of literacy, life expectancy, and other achievements that make Kerala so special. But by the eighties, Malabar had ‘caught up’ with the rest of Kerala to such an extend that it could no longer be seen in divergent terms. The initiatives that the state government of Kerala took, under different ‘managements’ (led by the Communist Party as well as by the Congress), succeeded in bringing Malabar rather at par with the rest of Kerala over a short period of time. So there is a lesson here that is not imprisoned in the fixity of history. Other past of India can indeed learn a lot from Kerala’s experience on what can be done here and now by determined public action.

It is also worth noting that while Karala was already quite advanced compared with British India at the time of independence, much of the great achievements of Kerala that are so admired now are the results of post-independence public policies. In fact, in the fifties Kerala adult literacy rate was around 50 percent compared with over 90 percent now, it’s life expectancy at birth was 44 years vis-à-vis 74 now and it’s birth rate was 32 as opposed to 18 now. Kerala did have a good start, but the policies that have made it’s achievements so extraordinary today are, to a great extend, the products of post- independence political decisions and public action[1].

Any student of history can observe participation of huge masses in public action in determining political decision that has been instrumental in transforming Kerala to the present state. Let it be the mass movements, of late fifties, sixties and early seventies, for radical land reforms or for liberating the educational system from the clutches of powerful managements. This has been proven true in the complete literacy programme, or in the people’s science movement and in the political mobilization to guarantee eight-hour working day and statutory minimum wage for agricultural labour. These are the rich experiences of the Kerala society, which forms the foundation, for moving ahead to the new era of participation in further developments of it’s social, political and economic life.

Peoples Plan Movement: An experiment in mass participation.

The much-debated peoples plan movement stands tall among all experiments in Kerala in the mobilization of masses in the process of participatory democracy and decentralized planning. The enactment of 1994 Kerala Panchayathi Raj – Municipal act, in tune with the 73, 74 constitutional amendment of 1992, opened up great opportunity for people to participate directly in the process of governess at the local self-government level. Conceived by the then Left Democratic Front government, of 1996-2001, the People’s Plan Movement was aimed at empowering people by allowing them the freedom of choice in the selection and formation of development projects in accordance with their concrete situations. By allocating about 40 percent of the state budget and a considerable number of state government employs to the local self governments, from different departments, significant efforts were made by the state government to empower the system with resource, powers and strength. Kerala, a highly political and open society, could not save the movement from its share of controversy. Despite all genuine criticism and reservations expressed by several quarters, it will be impossible to reverse the process of mass participation in the decentralized plan movement. Come whatever the change there may be, in its name, due to political consideration, this form of participation shall remain and strengthened in the days to come. Further it has already set in motion a chain of action and reaction affecting the entire spectrum of social, political and economic life of Kerala.

Major flaw of the much-celebrated Peoples Plan Movement was that, due to several reasons it could not attract middle and upper class sections, youth and students people with higher education and those with expertise and skill who could have been contributed to the process. This had its adverse impact on the movements’ quality and vibrancy. The movement had been dumped as one with the sole purpose of doling out benefits to individual political supporters, though the fact is largely otherwise. Secondly, the experts committees created in accordance with provisions of people’s plan, mainly composed of retired government officials, instead of assisting the elected local self governments, in several cases, usurped powers and even succeeded in blocking the process of participatory democracy and dwarfed the elected bodies.

Despite all those flows mentioned, the people’s plan movement made it’s definitive mark in improving grass root level participatory democracy, involving masses in the planning and execution of developmental projects; and improvement, in real terms, in the lives of a large number of marginalized. It was instrumental in drawing huge number of masses, especially women, who never had enjoyed in their life, meaningful participation in public action other than routine ritual of voting once in five years.

With the change in government, from Left Democratic Front to United Democratic Front, the movement has been re-christened as ‘Kerala Development Project’. Though, the basic character of the movement remain unaltered, the improper flow of state funds to the local self governments and the shift in priorities and perspective of the reigning government has dampened the enthusiasm that has been generated among the people of the state.

Participation : Kerala Women in Focus.

In comparison, with many other states, women in Kerala, are highly literate and educated. According to the 2001 census they outnumber male population with 1058 per every 1000. Manipur is the only other state in India with a higher female population than men. Female foeticide is almost unheard off. Dowry system, though prevalent among almost all cast and religious communities, dowry related murders and other atrocities are comparatively lower. However this is no indication to the statues of women n the family or in society. Neither it indicate absence of discrimination, elimination of atrocious acts against women including sexual harassment and exploitation. They still are economically underprivileged and prone to exploitation.

However, it is interesting for a keen observer of Kerala scenario to notice the radical shift, taking place, in the socio-economic and political status of women. And it is no exaggeration to state that, it is a silent revolution in the making. The women self-help group’s, especially the state supported ‘Kudumbasree’ project that are basically aimed at micro credit facility among women has become the main catalyst in the process. Their participatory public action has almost effectively eliminated cutthroat moneylenders from outside the state who had deep pen iteration in communities. This act put an end to the unproductive outflow of hard earned money from the state. They have provided women a new sense of self-respect, put in place a voluntary but efficient organizational system and infused new strength in them. This has been slowly being transformed in to determined socio-political action.

The new found economic freedom, organizational strength and exposures to the outside world, other than the traditional domain, is slowly leading them to micro enterprises-that are caring the family, society, above all the fragile environment, without forcing them to the migratory tendencies for bread winning jobs. With in a short span of years the money accumulated in banks by the women self-help groups have exceeded few hundred crores of rupees. Interestingly, now public sector banks are coming forward to advance capital lending for their enterprises and initiative with no collateral security. Further, in the Kudumbasree project circles itself, there is a thinking of establishing an exclusive bank catering entirely to the needs of women self-help groups. The enthusiastic participation of women in the grass-root level democratic process and their willingness to part-take in public action is not only surpassing the traditional role of men but also promise to change the stagnating socio-political and economic scenario of the state.

It is worth noticing the ongoing movement initiated by women groups, which mobilizes means of women, to establish Vigilance Committees and Family Empowerment Forum at each and every local self-government level. These committees empowered with statutory powers, equivalent to a civil court, will have great impact in ensuring gender equality, eliminating violence and atrocities on women and ending their marginalized existence at home and society. Further, if succeed, the movement will prove the power of public participation of women in getting things done were the state fail.

Mass Participation in altering the decadent state policies: The Kerala Experience.

Kerala has been witness to informed and voluntary public participation and action in altering the state policies that are against the interest of people, state and the nature and ecosystem itself. The mass opposition to the exploitation of invaluable ground water by the profit hungry multi-national Coco Cola; the use of deadly pesticides like Endosulphan; the move to extract mineral wealth from the coastal sands of Kerala, with no regard to grave consequences; the projects to build hydroelectric projects disregarding it’s implication to the rarest of rare forests; the proposal to build an Express Way dividing the narrow strip of land that is Kerala with no thought of its social, economic and environmental coast; the public pressure that is building up against polluting industries which are destroying our land, water sources and the nature itself are some resistance movement that have been witnessing mass participation worth mentioning.

The scenario gives a picture of public participation not only for the success of state sponsored programmes but also critical to its rational in the larger interest of people. Rational and informed participation in socio-political and economic life in Kerala requires patient study and analysis in order to understand an evolving society.

-Rajaji Mathew Thomas
Thenguvilayil House
Kannara.P.O, 680 652
Thrissur, Kerala.
Phone: 0487 2284207, Cell: 9895313696

[1] India: Development and Participation.


annilkhan said...

Burning question: Has micro credit done a lot?
found a good article and book on micro credit and grameen
Contributors of this book are Doug Henwood, Patrick Bond, Bosse Kramsjo, Badruddin Umar, Susan F. Feiner and Durcilla K. Barker, Farooque Chowdhury, Robert Pollin, Gina Neff , Anu Mohammad, Omar Tareq Chowdhury.

Here of the excellent article of this book:

The metamorphosis of micro-credit debtor
Farooque Chowdhury

Micro-credit, the well-propagated mantra in the fight against poverty, is now expanding crossing the national boundaries as capital has done for centuries. Countries in the centre and in the periphery in the present world system are near-spellbound by this mantra. The actors include kings, queens, statesmen, bankers, charity foundation initiators, economists, development workers and the poor. Only the last one is at the receiving end.
The metamorphosis of the micro credit debtor exposes the acts the capital plays in the act of micro credit and makes all its pious pronouncements hollow. The metamorphosis takes not only to the debtor, but also to other members of the debtor-household.
The debtor of the micro credit turns owner of the tools or raw materials necessary for producing commodity as the debtor returns home from market after purchasing these with the credit money. But with the joy of ownership a poor debtor enjoys through this metamorphosis there comes a new burden, the burden an industrial proletariat does not have to bear: the burden and responsibility of maintaining, repairing and replacing the tools, equipments or parts of these and the costs that accompany it as the debtor is going to produce and going to be a producer of commodities. It is an extra burden. Usually the job is done not only by the debtor, but also by the other members of the debtor—household. That means time, necessary or surplus labour, depending upon a situation. The proud ownership carries another intricate calculation. An industry owner provides premise, shade, light, water, storage facilities, transport, etc. for producing a commodity and before hiring a wage slave the owner has to spend money for these ranging from construction, power and water connections, supervision, etc. which are calculated before the surplus value is appropriated. But in case of the micro credit debtor turned independent owner of tools of production all these burdens fall upon the debtor. It is the responsibility of the debtor turned owner to repair/replace/heal and to spend money for these. That means the debtor has to arrange the constant capital, and sometimes, the variable capital. The creditor does not always provide the money required for these purposes or the debtor has to set aside a portion of the credit money for these purposes. If the debtor sets aside a portion then the person has to extend extra time to the portion of labour that produces surplus. Moreover, the debtor turned owner has to construct/raise a shed for carrying on the production activity and spend money and labour power belonging to the debtor and the debtor’s household. Actually, the debtor, most of the time, uses own premise, rent for which is paid by the owner of the production unit, the debtor. Maintenance and repair is paid by the debtor, now turned into an independent producer. An industrialist has to pay rent for the premise, utilities and other facilities while they are within the premises producing commodity. But in case of the micro-credit all these are the debtor’s responsibility. The metamorphosis of the debtor to owner of tools, etc., to independent producer thus does nothing but increase the surplus labour time and squeeze necessary labour time so that the repayment of the loan can be made as per schedule.
The debtor turned producer has to plan, search and work out comparative advantage, and procure and transport required raw materials for the commodity to be produced. The debtor, now acting as procurement manager of the household-based production unit, procures and carries or transports the raw materials for the commodity to be produced. Sometimes it is the spouse or sibling who performs the task, unpaid and unaccounted labour power put into the process. Is the equation in favour of the fellow who went to the banker for the poor to realise the fundamental right the banker propagates? Reality is that the shortened necessary labour time and the lengthened surplus labour time, obviously provide the answer. What about the level of appropriation? It is, certainly, not at the level Marx ‘calculated’. It is super-appropriation, never imagined by the mine owners of Rome, the colonial plunderers, the plantation owners, the slave owners in pre-slavery America, the multi-nationals operating in the countries on the periphery, not even the plundering-lumpen capitalists in a number of underdeveloped countries, but only by the multi-national micro credit capital. So, Michael Lipton and John Toye said in ‘Does Aid Work in India?’ : Rates of return on credit projects are particularly high in India; and Joe Remenyi said in ‘Where Credit is Due: Income Generating Programmes for the Poor in Developing Countries’: Credit - based income generating projects may be the most profitable way in which society can invest…Diminishing return has not set in this field…;…banking on and with the poor is a very good thing to do…. The typical successful CIGP …required an investment well below $1,000 per sustained wage - paying position created (one - tenth of the ratio in the formal sector)…[W]hen one is living at the margin of survival earning around $1 a day, an increase in earning capacity of 50 cents a day represents a substantial improvement in cash flow. These statements tell the truth.
The metamorphosis of the debtor moves further as the fellow turns wage labourer. The micro credit finds a new commodity as, borrowing from Engels, the ‘source of new value,’ source of surplus ‘income’ with which the debtor will repay and ‘this commodity is labour-power’. The labour power is stored up in the bodies of the micro credit debtors and other members of the debtor-household who extend respective labour power to extend the surplus labour time so that the repayment could be made on schedule. As an independent producer the debtor has to fix the pace of production and that determines the debtor turned wage labourer’s pace and length of working hour. Even, the debtor wage labourer has to borrow labour power of others in the household, who are actually paid only by bare subsistence. To make the statement complete it is not the debtor only, but other members in the debt ridden household, along with the debtor, also, turn wage labourer, at least, part time. Does it not appear more intense than the conveyor belt or the Taylor system innovated by the industrialists to increase surplus value? Thus, the entire household turns into a household of wage labourers, full time or part time. Actually, the pace of work is determined by the time schedule of the repayment. Within the scheduled time for repayment the independent producer turned wage labourer, along with the co-workers in the household have to produce and sell that quantity or that number of commodity that can bring in at least the amount of money needed to repay the instalment of the debt. If seasonal variations, changes in market, health problems, other unseen troubles, non-availability of raw materials or transport, in short, major and minor forces, i.e. ‘acts of god and acts of reality’, coordination with the marketing day and the instalment day are taken into account then the pace of production of a debtor turned independent producer turned wage labourer can be imagined. The person has to forget 8-hour working day, rest, amusement and attending to family chores. It is only to produce surplus enough for repayment. Does it sound like the sweating system? Does an industrialist having a supervisor or a foreman appear fool? While an industrialist has to devise a mechanism, a supervisory system and keep a physical appearance in the work place the micro credit capital does not require all these. Its mere regimentation, mere providing credit at the doorsteps of the poor and its higher level of ‘consideration’ or attention regarding collection of part of the credit from the debtor’s home so that the poor fellow does not turn a defaulter that determine the pace of production. This is the condition of the micro credit wage labourer, obviously a bit different from an industrial wage labourer. An industrialist ‘purchases the use of one week’s labour of [a] worker’ if the worker is paid on weekly basis, but the micro creditor purchases the labour of the debtor for an entire year, if, assumed that the loan will be repaid within a year, or for the entire period until the loan is repaid. With the payment for necessary labour time, a specific amount of money paid for subsistence of a worker and members of the worker’s family, an industrialist ‘ensures the continuance of labour-power even after his [the worker’s] death’, but the micro-creditor ensures the simultaneous use of labour - power of the household members of the debtor along with that of the debtor. The labour, through persistent struggles, has won, in relative terms, a number of measures to safeguard own body and soul and the capital has to compromise for its own sake. But the micro credit debtor turned wage worker toils without coverage of any such measure. The micro credit capital that finances micro-production units at household level is smart enough to escape, till today, the struggle of the debtor turned wage worker, by pass all rules, even norms attained so far, and stay safe. There is no working hour; no weekly holiday; no law, rule, regulation governing working time, working condition, safety measures, child labour, female working hour, etc.; no inspectorate looking at the working condition. This makes life miserable for the micro credit debtor turned wage worker and for the members of the household including the minors who help create surplus value without any legal coverage.
Now, only a few numbers quoted from Microfinance Statistics (vol.17, Dec., 2004), a publication of the Credit and Development Forum. These will help comprehend, at least partially, the width and length of the micro credit net and the surplus value it appropriates in a single country. In Bangladesh, in 2004, the number of active members in the 721 micro financing organisations (MFO), reporting to the CDF, was 16,622,047 and in 2000, it was 11,021,663 in 585 MFOs. In 2004 the number cumulative borrowers from 721 MFOs was 16,244,242 in a country of 140 million. It was 7,409,773 from 585 MFOs in 2000. There are many other MFOs that have not reported to the CDF, many others are operating in different guises and many other programmes and projects operating not as MFOs but carrying on micro credit business. From how many souls do a group of industrialists in a poor country appropriate surplus value? Are those always more than the number just cited? There are answers, obviously, to this question. It is expected that a reader will search the answers.
The metamorphosis of the micro-credit debtor continues further as the person moves to market with the commodity produced. The debtor then turns to an independent trader competing with peer debtors turned independent traders in the market place and at the same time they together fall prey to the vagaries of market governed by the mighty market forces. While carrying the commodity to the market, sometimes, some other members of the household, shares the load. This labour is unpaid in terms of wage. If counted or paid, the amount comes from the surplus value already generated. If it is unpaid then the amount thus saved stays within the surplus value to be paid to the creditor waiting for the next instalment of repayment. As an independent trader the debtor turned independent producer turned wage worker has to bear all the responsibilities of a trader. But an industrial labourer does not have to take all these responsibilities. The wage slave in a factory just completes respective job and gets compelled to be appropriated of the surplus labour time. Market, supply, demand, transportation of commodity to market, storage, taxes and tolls, speculation, price, etc. are not part of a factory worker’s business. But as an independent trader the micro credit debtor has to bear these extra burdens which are not the creditor’s concern at all. The creditor has tactfully, through the modus operandi, has put it upon the poor debtor’s weak shoulder. There are commodities in the market that are produced in larger, mechanised production units, with higher productivity, which means a cheaper commodity, and, commodities that enjoy facilities created by the WTO. This situation puts the debtor into an unfavourable, uneven playing field, cuts down the debtor’s competitive edge and presses down price of the commodity produced in the household by semi-skilled and unskilled workers and produced with artisan method and tools. There is the packaging, marketing and advertising factor. The person has to reconcile with the situation and that means further tightening of belt. The micro-credit thus pushes the debtor to such a situation with extra burdens while it demands regular repayment of the credit.
The data on the sectors or sub-sectors that use micro credit in Bangladesh show the sources of surplus value appropriated and who ‘offered’ the surplus labour to generate the surplus value. In 2004, according to the data published in the above mentioned CDF publication, of the 379 MFOs reporting to the CDF, 27.94 percent of cumulative disbursement was in the agricultural sector that included crops, livestock and fisheries sub-sectors while only petty trading sub-sector covered 40.61 percent. The percentage of food processing and cottage industries was 6.28 and of transport it was 2.20. In the years 2003, 2002, 2001 and 2000 the petty trading dominated. From where does trading, whatever its size is, produce the profit? A portion of it is surplus value generated by others in other places. What about the transport, the rickshaw van or the boat, and the cow fattening? The same answer. It is also the surplus value generated by and in different segments of the broader society that is appropriated by micro credit capital that gets in through the debtor’s hand. Other sectors and sub-sectors also provide similar explanation found in political economy. The above mentioned CDF publication provides a few more startling facts: ‘utilisation of loan by sector or sub-sector (as percentage of cumulative disbursement)’ in ‘social sectors’ in 2004 was 1.70 (health:0.44, education: 0.06 and housing:1.20); in 2003 it was 1.58 (0.45 for health, 0.04 for education and 1.09 for housing); in 2002 it was 1.41 (0.39, 0.05 and 0.97); in 2001 it was 1.76 (0.42, 0.11 and 1.23); and in 2000 it was 1.69 (0.37, 0.02 and 1.3). The ‘social sector’ meant by the cited publication was health, education and housing which are actually required for ensuring the debtor’s and the debtor household’s survival, keeping the body and soul of the household based producers or of the trader or of the transport operator together, ensuring that production or trading could be carried on or transport could be operated so that surplus value generation or taking share of surplus value generated by some other is ensured, so that the repayment that includes surplus value is ensured. If a debtor does not have a house or a shed the production unit will be inoperative or will face problems in the production activities; the raw materials, the tools, the fuel, the cow or goat or poultry, the commodity produced could not be stored in; the producer and others in the household joining in the production activities could not survive. So, the housing sub-sector was emphasized most while lending out money in the CDF defined ‘social sectors’. Of course, the façade was benevolence by the micro creditor. Then came health with the same arguments. A judicious choice of the appropriator! Material interest tops the list over human consideration. The extent of concern for health of debtor and debtor household is directly related and tied to the extent of concern of continuation of production, etc. activities. It was followed by education. The level of production and the level of transaction determine the extent of education required and the level of emphasis put into education. None can override this rule. The micro-creditor, also, faithfully follows this one and the life of debtor goes through this metamorphosis.
Thus, the circuit of metamorphosis of micro-credit debtor moves on and ultimately it completes a full path: a poor, an appropriated person turns debtor, the debtor turns owner of tools of production., the owner turns household based independent producer, the independent producer turns wage worker, the worker turns independent trader, the trader stays entrapped into debt with worsened condition and bigger debt turning one to debt slave. In its circuit the micro credit debtor only produces surplus value or takes a portion of surplus value produced by some other debtor or some other person or persons in the society producing surplus value and transfers a portion of it to micro credit capital. The circuit is both, a closed and an open, signifying the contradiction. The closed circuit keeps the debtor in perpetual and worsening poverty; sometimes, borrowing from the micro-credit literature, graduating a percentage of the borrowers, but pushing down or entrapping others in increased number; and often, throwing back the graduated debtor to the den of poverty again; and in these cases, the mainstream economics finds the rationale in ‘shocks’, ‘setbacks’, etc., natural and social, as their terminology defines. But whatever happens in the lives of a certain percentage of the debtor that does not change the basic structure of the circuit in the broader social matrix, in the process of appropriation of surplus value. Ignoring the macro scenario and putting forth the micro, a few individual cases, putting forth the exceptions instead of the general rule does nothing but vulgarises the arguments itself pushed forward by the mainstream. The open circuit intensifies and accelerates the pauperisation process and thus creating pressure on the system that creates poverty, makes a person poor, and appropriates surplus value. The vulgar economics with ‘hollow eye and wrinkled brow’ (Shakespeare, Merchant of Venice) extending support to micro credit capital may construct a façade by resorting, again, to vulgar arguments. It may argue that a certain percent of micro credit debtors have improved their living condition with the aid of the panacea as a few days ago they used to mean the micro credit. But this does not nullify the fact of appropriation of surplus value from others in the broader society. Rather, it puts the evidence that surplus value has been appropriated from some other persons. There are many economists in the bandwagon of micro credit who cite cases of increased consumption by the micro credit debtors. But it should not be missed that consumptions are of two types: productive and individual; while the first one is to create products the other is turned into means of subsistence. So, data of debtors’ increased consumption, claims regularly made by the mainstream economics, carry no meaning other than better and ensured supply of surplus labour power which is expropriated. The fact should not be missed that the entire system rests on the appropriation of surplus value and micro credit is a part and, now is an institution of the system. It is sustained by the system and it helps sustain the system.
The socialisation of micro-credit, with its profit profile, allures other capitals in banks and financing companies to join in. The capital engaged in micro-credit ties, quoting from Shakespeare, the ‘poor man’s cottages [to] princes palaces,’ organises and regulates debtors including members of the debtor-households, keeps them entrapped in the micro credit web, appropriates surplus labour power of them and others in the broader society. Moreover, it now regulates, based on its global power, the analytical process of a section of economists who overlook the process of appropriation of surplus value upon which the micro credit thrives, and try to ignore definitions of political economy and propagate vulgar ideas.

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