Third World America

by Arianna Huffington

  In Brooklyn, New York, FEAST (Funding Emerging Art with Sustainable Tactics) hosts volunteer-prepared dinner parties in a church basement, where locals are invited to pitch ideas for community art and improvement projects.155 The 250+ dinner-goers pay ten to twenty dollars to attend the fetes, where they feast on local food, listen to live music, socialize, and vote on their favorite proposals. At the end of the dinner, FEAST organizers present the winner with the prize money, raised from that night’s admission proceeds, for the implementation of the project.

  Matthew Bishop, U.S. business editor for the Economist, in his book Philanthrocapitalism, explored how this moment of crisis for capitalism and philanthropy could be used to transform both—how capitalism could be imbued with a social mission, and philanthropy could be reinvigorated with the best practices of capitalism.156 And in seeking to blend the efficiency of enterprise with the benefits of philanthropy, the burgeoning social entrepreneurship movement does precisely that. Social entrepreneurs pinpoint social problems and, rather than waiting for government action, apply market principles to solve them in original ways.157 Supported by investment funds from organizations such as Echoing Green, Ashoka, and Investors’ Circle, trailblazing social ventures are reenvisioning the way social change happens, not only abroad, but here at home, too.

  Providing microcredit to small businesses is an innovation for which Muhammad Yunus won the Nobel Peace Prize in 2006.158 In 2008, Yunus’s Grameen Bank opened a branch in New York.159 In 2010 it opened a branch in Omaha, Nebraska.160 The Grameen Bank’s slogan: “Banking for the unbanked.”161 Hoping to serve one million American entrepreneurs, Grameen America plans to expand into more than fifty cities across the country, including Washington, D.C., and San Francisco.162 A practice most closely associated with helping struggling Third World countries has now arrived in America. By February 2010, the New York branch had extended loans to 2,500 clients, mostly women. The average loan amount is $1,500 (no collateral necessary) and more than 99 percent of the recipients make their payments on time.163

  Grameen Bank is not the only organization committed to providing microcredit to small businesses here at home. Since 1991, ACCION USA has lent over $119 million, in the form of more than 19,500 small-business loans, to low- and moderate-income entrepreneurs.164 Luis Zapeda Alvarez, for example, who was once homeless and out of work, now runs his own business delivering baked goods to New York City restaurants and delis—in large part due to the assistance he received.165 After banks refused to lend him start-up capital, Alvarez approached ACCION and borrowed enough money to buy the delivery truck he needed to get his business off the ground. When his truck needed new insulation, ACCION USA helped him secure a $5,600 loan to make the improvements. Alvarez’s business has expanded to three daily delivery routes—he’s now so busy that he had to hire a part-time employee—and his success as an entrepreneur has helped cement his relationship with his children.

  Another New Yorker, Lyn Genet Recitas, opened Neighborhood Holistic, a yoga studio and spa, in Harlem with the help of a microloan from ACCION USA.166 Within a year, the studio was profitable, and Recitas expanded her venture, bringing on twelve part-time employees and providing yoga scholarships for low-income community members.

  Some of the most exciting social advocacy and “citizen philanthropy” is happening on the Web. DonorsChoose.org, for example, invites public school teachers from around the country to post funding proposals for classroom needs. Users browse the listings—for things such as notebooks and pencils, LCD projectors for math instruction, or mirrors so that art students can practice drawing self-portraits—and donate however much they’d like to their chosen projects.167 By May 2010, just a decade after the site was started by Bronx high school social studies teacher Charles Best, DonorsChoose.org had raised over $52 million across more than 130,000 different proposals.

  In Connecticut, Web developer Ben Berkowitz has launched SeeClickFix.com, which invites users to post nonemergency problems in their neighborhoods, such as a broken streetlamp or a potholed road.168 Other community members are encouraged to chime in with solutions; sometimes neighbors reply with fixes within minutes. With SeeClickFix.com, citizens can more rapidly identify and repair local problems to improve their neighborhoods and, by extension, the entire country.

  Using the backbone of social networking to help people connect and find service opportunities that fit their specific abilities and aspirations is the idea behind All for Good, launched in 2009 by Google engineers (using the company’s “20 percent” philosophy that allows employees to spend one day a week working on passion projects).169 The goal was to apply the power of the search engine to service and volunteerism and put social media—including Facebook Connect and Google Friend Connect—at the service of service. Among the initiatives is Cities of Service, which makes it easier for mayors across America to use the Web to promote volunteerism opportunities in their communities.

  Social media sites are also being used to create a sense of community to see us through these dark economic times and help us transcend feelings of being victimized and powerless. At sites such as Recessionwire.com, LayoffSupportNetwork.com, LayoffSpace.com, HowIGotLaidOff.com, and The The405Club.com, job seekers share tips about finding work and getting by, and safely voice anxieties and fears about the future. Others have reported landing jobs by using Web stalwarts such as Facebook and Twitter to informally network with friends and associates.

  When television journalist Andrea McCarren was abruptly laid off from her job at ABC affiliate WJLA-TV in Washington, D.C., her first move was to update her Facebook status.170 “Andrea McCarren was just laid off, and is enormously grateful for her 26-year run in television news,” she wrote. Her friends and former colleagues were immediately made aware of her job loss—and they responded with an outpouring of support, spreading the news via Twitter. “Social media, I learned that day, was like a wildfire, spreading rapidly across the Internet, with little possibility of containment,” McCarren wrote in a March 2010 piece for Nieman Reports. “My Facebook posting immediately led to a flood of phone calls, condolence e-mails, and job leads. A Facebook friend I’d met in person just one time introduced me to a high-profile CEO and entrepreneur who flew me to California for a job interview the next week. Former colleagues and even several interns I’d mentored in the past spoke to their bosses and paved my way into their news operations within days. No one was hiring but it boosted my spirits to make so many contacts.” McCarren and her husband, “awed by the compassion and kindness of Americans who wrote,” were inspired to launch Project Bounce Back, an online community centered around stories of resilience in times of economic hardship. The project eventually sent the McCarrens and their three children on the road, traveling around the country and chronicling tales of American hope and vitality.171

  Taken together, these efforts, and thousands of others like them, are helping turn the country around. And it would be great if more of America’s super affluent—the wealthiest 1 percent, who hold 35 percent of the nation’s wealth—also tapped into their reserves of empathy and acted on Andrew Carnegie’s assertion that “he who dies rich dies disgraced.”172, 173

  That’s a sentiment that Bill Gates and Warren Buffett clearly share. The pair has launched The Giving Pledge, a campaign to convince the world’s billionaires to give at least 50 percent of their money away.174 Buffett has promised to give 99 percent of his roughly $46 billion to charity; Gates has made a similar pledge.175 And others are starting to join in, including Michael Bloomberg, who, echoing Carnegie, says: “I am a big believer in giving it all away and have always said that the best financial planning ends with bouncing the check to the undertaker.”176 If The Giving Pledge catches on, Gates and Buffett believe they can generate $600 billion for philanthropic causes.177

  At the tail end of the last Gilded Age, the opulently rich—men like Andrew Carnegie, Cornelius Vanderbilt, John D. Rockefeller and Andrew W. Mellon—led a nationwide wave of philanthropy. If B
uffett and Gates are successful, as our own Gilded Age nears its end, a second great wave of giving is coming. And it couldn’t be more timely.

  HOPE 2.0

  The 2008 election was all about “hope.” But just hoping that our leaders in Washington will somehow miraculously start doing the right thing—especially when they are locked inside a system with overwhelmingly powerful incentives to do the wrong thing—simply won’t cut it.

  What we need is Hope 2.0: the realization that our system is too broken to be fixed by politicians operating within the status quo, however well intentioned. Change is going to have to come from outside Washington. But no fundamental political change can be accomplished without a movement demanding it. As Frederick Douglass put it, “Power concedes nothing without a demand; it never did and it never will.”178

  The perfect example of this came in March 1965.179 In an effort to push for voting rights legislation, Martin Luther King met with President Lyndon Johnson. But LBJ was convinced he didn’t have the votes needed for passage. King left the meeting certain that the votes would never be found in Washington until he turned up the heat in the rest of the country. And that’s what he set out to do: produce the votes in Washington by getting the people to demand it. Two days later, the “Bloody Sunday” confrontation in Selma—in which marchers were met with tear gas and truncheons—captured the conscience of the nation. Five months after that, on August 6, LBJ signed the National Voting Rights Act into law, with King and Rosa Parks by his side.180

  At that March meeting, LBJ didn’t think the conditions for change were there. So King went out and changed the conditions.

  Similarly, before the start of WWII, legendary labor leader A. Philip Randolph, president of the Brotherhood of Sleeping Car Porters, lobbied FDR to promote equal employment opportunities in the defense industry. Roosevelt was sympathetic but made no promises.181 Randolph responded by taking his cause to the American people, organizing a massive march on Washington. Concerned about the impact the march would have on the country’s wartime morale, Roosevelt got Randolph to call it off by issuing an executive order banning discrimination in defense industries and creating the Fair Employment Practices Committee to watch over hiring practices.

  In recent decades the system has gotten only more rigged and the powers that be more entrenched. The ability of special interests to thwart meaningful change has never been stronger. And the reason we are given—time after time after time—for why we can’t have fundamental reform? What else: The votes just aren’t there!

  That’s where Hope 2.0 comes in. If the votes aren’t there, the people need to create them. If politicians put their finger in the wind to see which way it’s blowing before deciding what to do, well, let’s change the direction of the wind.

  In the early days of the financial crisis, as I looked at the tone-deaf response of Wall Street, including former Merrill Lynch CEO John Thain and his now infamous $1.2 million office redecoration in the midst of the economic collapse, I thought of Thain and his Big Banking brethren as the Marie Antoinettes of the meltdown.182 They just didn’t get it.

  Little did I realize just how small-scale Thain’s outrages would seem and how much worse things would get in the ensuing months. Goldman Sachs’s Lloyd “Doing God’s Work” Blankfein, BP’s Tony “I’d Like My Life Back” Hayward, and their fellow too-big-to-fail CEOs—with their utter cluelessness about the public’s anger over what they’ve done and continue to do—take “not getting it” to a whole other level.183, 184

  Luckily for them, society has evolved, and we express our anger differently than we did in Marie Antoinette’s day. “Off with their bonuses” is a lot less painful than “off with their heads.” But the question is, can the American people’s righteous—and entirely justifiable—rage be productively channeled to produce a real movement for reform, or will it be hijacked by dangerous demagogues, with whatever is left over co-opted by agents of the status quo in Washington?

  In 2004, hope was ignited by an unknown state senator standing up and proclaiming that we are not blue states and red states, but one people who can only solve our problems together.

  In 2008, hope was about crossing our fingers and electing leaders who we thought would enact the change we so desperately need.

  Hope 2.0 is about creating the conditions that give them no other choice.

  THE CHOICE IS OURS

  Clearly, we all have a lot of work to do—both on ourselves and on our country. The good news: Real change, fundamental change, is possible, but only if we recognize that democracy is not a spectator sport—and get busy.

  President Obama has said that we find ourselves at “a rare inflection point in history where the size and scope of the challenges before us require that we remake our world to renew its promise.”185

  So, as we stand at this inflection point and gradually move from what Jonas Salk called Epoch A (our survival-focused past) to Epoch B (our meaning-focused future), we have to ask ourselves what this remade world will look like.

  Will it be a place where economic opportunity is once again real for everyone, not just the economic elite?

  Will it be a place where greed and selfishness are no longer rewarded and “the least among us” are given a helping hand, rather than the back of it?

  Will it be a place where bridges are fixed before they collapse, and students aren’t allowed to founder in failing schools?

  Will it be a place where the public interest once again trumps the special interests, and public policy is no longer auctioned off to the highest bidder?

  Will it be a place where transparency reigns and backroom deals are banished from the halls of power?

  Will it be a place where Main Street replaces Wall Street as the center of the economic universe?

  Will it be a place where the middle class no longer has a bull’s-eye on its back and the American Dream is more than just a hallucination or a distant memory seen only in our nation’s rearview mirror?

  The choices we make—both as individuals and as a society—will determine whether America becomes a Third World country or the “more perfect union” our founding fathers envisioned.

  The moment to act is now. Inflection points in history don’t come along very often.186

  NEXT STEPS? CLICK HERE

  Few will have the greatness to bend history itself, but each of us can work to change a small portion of events and in the total of all those acts will be written the history of this generation.187

  —ROBERT F. KENNEDY

  So often, our desire to take action gets derailed by our uncertainty over exactly what action to take, and how to best make a difference. To bridge the gap between intention and involvement, we’ve created a section on the Huffington Post where you can find out more about what you can do to help make sure we never find ourselves living in Third World America. Go to www.huffingtonpost.com/ThirdWorldAmerica—and get involved.

  ACKNOWLEDGMENTS

  After finishing my twelfth book, I asked my daughters and close friends to do an intervention if I ever decided to write another one. “No more books” I promised them—and myself. No more juggling the demands of writing a book and the demands of HuffPost (now a tireless and rambunctious five-year-old that never takes a nap).

  And then Richard Pine, my wonderful agent and friend, called. “Roger Scholl wants you to write a book for Crown about—” Politely but firmly, I stopped him. “I don’t want to know,” I said. “I don’t want to be tempted.” A few days later he called back and before I could stop him he told me that Roger had been reading what I’d been writing about the decline of America’s middle class and wanted me to write a book about it. The decline of the middle class was, in fact, a subject I had become obsessed with, both in my own writing and in HuffPost’s coverage of the economic crisis. We had even dedicated one of our reporters, Arthur Delaney, to the beat—putting flesh and blood on the gloomy statistics. We considered calling him our “economic suffering correspondent” but that so
unded too lugubrious, so we settled on our “economic impact correspondent.”

  So I went from “never again” to “how soon could we bring it out?” As for that intervention thing, I just didn’t tell my daughters or my friends what I was doing until I’d already finished the first draft. So, first of all, thank you to Michael Palgon, the deputy publisher at the Crown Publishing Group, and Editorial Director Roger Scholl for the idea—and to Michael Palgon for the book title. And thanks for all of Roger’s brilliant editing along the way.

  And thank you to Katie Flynn, Nour Akkad, Anna Almendrala, Alex Amend, and Michael Spies for all their help with research, fact-checking, and source notes. My gratitude goes to HuffPost’s editor Roy Sekoff, who read the first draft and vastly improved it, to Stephen Sherrill, for all his great editorial suggestions, and to Grace Kiser and Kerstin Picht, who brought extraordinary dedication and commitment both to the subject and to the process of getting the book to press.

  My gratitude also goes to Nick Penniman, Dan Froomkin, Adam Rose, Ryan Grim, Shahien Nasiripour, Marcus Baram, Alex Leo, Ryan McCarthy, Brian Sirgutz, and Mario Ruiz, who read the galleys and offered many improvements and suggestions.

  Very special thanks to Brenda Carter, Johnny Parker, Matt Stagliano, Linda D. Wilson, Dean Blackburn, Ron Bednar, Mary McCurnin, Kimberly Rios, Faye Harris, Ricky Macoy, Heather Tanner, Amy Brisendine, Rajiv Narayan, Janet H., Patty C., Henry Chalian, Jim Laman, Troy Renault, Rebecca Admire, Monique Zimmerman-Stein, Gary Stein, H. Lee Grove, and Lesa Deason Crowe for sharing their stories of struggle and resilience.