New Books in Economics

Mara Kardas-Nelson, "We Are Not Able to Live in the Sky: The Seductive Promise of Microfinance" (Metropolitan Books, 2024)

Nov 5, 2024

Mara Kardas-Nelson, an independent journalist focused on international development, dives into the tangled history of microfinance. She shares intimate stories from Sierra Leone, revealing how high-interest loans often hinder rather than help women. Kardas-Nelson critiques the simplistic narratives surrounding microfinance, urging a reevaluation of its impact and the realities facing borrowers. She also reflects on her personal journey in documenting these experiences, highlighting the complex interplay between international aid and local economic challenges.

45:54

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Mara Kardas-Nelson

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Quick takeaways

Mara Kardas-Nelson highlights the complex realities of microfinance, revealing how high-interest loans often exacerbate the hardships of borrowers in West Africa.

Through personal narratives of women in Sierra Leone, the podcast underscores the emotional and social ramifications of indebtedness in microfinance programs.

Deep dives

The Complex Reality of Microfinance

Microfinance, often hailed as a win-win solution for poverty alleviation, can have unintended consequences for borrowers, particularly women in West Africa. The framing of microfinance as solely a positive debt-based practice obscures the burdens that come with high interest rates and accumulating debt. For instance, women in Sierra Leone faced effective interest rates that soared between 40 and 60% when factoring in additional fees and penalties, which led to dire financial situations, including asset liquidation and potential legal troubles. Therefore, understanding microfinance requires examining the nuances of debt and its impact on the lives of the most vulnerable populations.

Intro

2min

Unraveling Microfinance: Women’s Debt in West Africa

17min

Reflections on International Aid and Personal Journey

2min

Rethinking International Aid and Microfinance

11min

Navigating Microfinance Narratives

9min

Reflections on the Journey of Writing and Future Endeavors

3min

In this deeply researched and compelling narrative, journalist Mara Kardas-Nelson examines the complex history and impact of microfinance - the practice of giving small loans to poor people, particularly women, that was once hailed as a revolutionary solution to global poverty. Through intimate portraits of borrowers in Sierra Leone and extensive interviews with key figures in the microfinance movement, Kardas-Nelson reveals how an idea that began with noble intentions became a multi-billion dollar industry with sometimes devastating consequences for the very people it aimed to help.

We Are Not Able to Live in the Sky: The Seductive Promise of Microfinance (Metropolitan Books, 2024) weaves together two parallel narratives: the stories of women in Sierra Leone struggling with high-interest microloans while trying to support their families, and the history of how microfinance evolved from a small experiment into a global phenomenon championed by the likes of Hillary Clinton and Muhammad Yunus. Through careful reporting and historical analysis, Kardas-Nelson explores how problematic ideologies about poverty, entrepreneurship, and individual responsibility shaped the development of microfinance programs, often overlooking local economic realities and existing informal lending practices.

What makes this book particularly valuable is how it challenges conventional narratives about microfinance without dismissing the real needs that drive people to seek these loans. Through detailed portraits of women in Sierra Leone, Kardas-Nelson shows how borrowers navigate a complex web of debt, social obligations, and economic pressures. The author raises important questions about whether encouraging poor people to take on high-interest debt is truly the best way to address poverty, while also examining alternative approaches like direct cash transfers and comprehensive social services.

This timely investigation offers crucial insights for anyone interested in international development, poverty alleviation, and the often unintended consequences of well-meaning interventions in the lives of the world's poor. Through meticulous reporting and thoughtful analysis, Kardas-Nelson challenges readers to think more critically about how we approach poverty alleviation and what truly constitutes meaningful economic development.

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