Environmental Problems, Their Causes, and Sustainability 1

Microloans to the PoorMost of theworld’s poor wantto earn more, becomemore selfreliant,and haveSOLUTIONSa better life. Butthey have no credit record. Also,they have few if any assets to usefor collateral to secure a loan tobuy seeds and fertilizer for farmingor tools and materials for a smallbusiness.For almost three decades an innovativetool called microlending ormicrofinance has helped deal withthis problem. For example, sinceeconomist Muhammad Yunusstarted it in 1976, the Grameen (Village)Bank in Bangladesh has providedmore than $4 billion in microloans(varying from $50 to $500)to several million mostly poor,rural, and landless women in 40,000villages. About 94% of the loans areto women who start their ownsmall businesses as sewers,weavers, bookbinders, peanut fryers,or vendors.To stimulate repayment andprovide support, the GrameenBank organizes microborrowersinto five-member “solidarity”groups. If one member of the groupmisses a weekly payment or defaultson the loan, the other membersof the group must make thepayments.The Grameen Bank’s experiencehas shown that microlending isboth successful and profitable. Forexample, less than 3% of microloanrepayments to the Grameen Bankare late, and the repayment rate onits loans is 90–95%, much higherthan the repayment rate for conventionalloans by commercialbanks throughout most of theworld.About half of Grameen’s borrowersmove above the poverty linewithin 5 years, and domestic violence,divorce, and birth rates arelower among most borrowers.Microloans to the poor by theGrameen Bank are being used todevelop day-care centers, healthclinics, reforestation projects, drinkingwater supply projects, literacyprograms, and group insuranceprograms. People also use them tobring small-scale solar and windpower systems to rural villages.Grameen’s model has inspiredthe development of microcreditprojects in more than 58 countriesthat have reached 36 million people(including dependents), and thenumber is growing rapidly.Critical ThinkingWhy do you think there has beenlittle use of microloans by internationaldevelopment and lendingagencies such as the World Bankand the International MonetaryFund? How might this situation bechanged?Mostly because of stricter air pollution regulations,German companies have developed some ofthe world’s cleanest and most efficient gas turbinesand invented the world’s first steel mill that uses nocoal. Germany sells these and other improved environmentaltechnologies globally. Germany is alsoone of the world’s leading manufacturers of windturbines.In 1977, the German government started the BlueAngel eco-labeling program to inform consumers aboutproducts that cause the least environmental harm (Figure26-13). Most international companies use theGerman market to test and evaluate green products.German car companies, as part of a recycling revolution,are required to pick up and recycle all domesticcars they make, and such take-back requirements are beingextended to almost all products to reduce use of energyand virgin raw materials. Germany is selling theserecycling technologies to other countries.Germany’s government has supported researchand development aimed at making it the world’sleader in solar-cell and wind turbine technology andhydrogen fuel.Finally, Germany provides about $1 billion peryear in green foreign aid to developing countries,much of it is designed to stimulate demand for Germantechnologies and products.In 1989, the Netherlands—a tiny country withabout 16 million people—began implementing aNational Environmental Policy Plan, or Green Plan, asa result of widespread public alarm over decliningenvironmental quality. The goal is to slash productionof many types of pollution by 70–90% and achieve theworld’s first environmentally sustainable economy,ideally within a few decades.The government began by identifying eight majorareas for improvement: climate change, acid deposition,eutrophication, toxic chemicals, waste disposal,groundwater depletion, unsustainable use of renewableand nonrenewable resources, and local nuisances(mostly noise and odor pollution).Then the government formed task forces consistingof people in industry, government, and citizens’groups for each of the eight areas, asking each task forceto agree on targets and timetables for drastically reducingpollution. Each group was free to pursue whateverpolicies or technologies it wanted, but if a group couldnot agree, the government would impose its own targetsand timetables and stiff penalties for industries notmeeting certain pollution reduction goals.Each task force focused on four general themes.(1) life-cycle management (Figure 26-11, right); (2) energyefficiency, with the government committing $385million per year to energy conservation programs;http://biology.brookscole.com/miller14601