My life

From Hillary, I had learned most of what I knew about early-childhood development and its importance to later life. She had been interested in it as long as I’d known her, and had taken a fourth year at Yale Law School to work on children’s issues at the Yale Child Study Center and Yale–New Haven Hospital. She had worked hard to import to Arkansas an innovative preschool program from Israel called HIPPY, which stands for Home Instruction Programs for Preschool Youngsters, a program that helps to develop both parenting skills and children’s ability to learn. Hillary set up HIPPY programs all across the state. We both loved going to the graduation exercises, watching the children show their stuff and seeing the parents’ pride in their kids and themselves. Thanks to Hillary, Arkansas had the largest program in the country, serving 2,400 mothers, and their children showed remarkable progress. The main focus of my economic development efforts was to increase investment and opportunity for poor people and distressed areas, most of them in rural Arkansas. The most important proposal was to provide more capital to people who had the potential to operate profitable small businesses but couldn’t borrow the money to get started. The South Shore Development Bank in Chicago had been instrumental in helping unemployed carpenters and electricians set themselves up in business on the city’s South Side to renovate abandoned buildings that otherwise would have been condemned. As a result, the whole area recovered.

I knew about the bank because one of its employees, Jan Piercy, had been one of Hillary’s best friends at Wellesley. Jan told us South Shore got the idea to fund artisans who were skilled but not creditworthy by conventional standards from the work of the Grameen Bank of Bangladesh, founded by Muhammad Yunus, who had studied economics at Vanderbilt University before going home to help his people. I arranged to meet him for breakfast in Washington one morning, and he explained how his “microcredit” program worked. Village women who had skills and a reputation for honesty but no assets were organized in teams. When the first borrower repaid her small loan, the next one in line got hers, and so on. When I first met Yunus, the Grameen Bank already had made hundreds of thousands of loans, with a repayment rate higher than that for commercial lenders in Bangladesh. By 2002, Grameen had made them to more than 2.4 million people, 95 percent of them poor women.

If the idea worked in Chicago, I thought it would work in economically distressed areas in rural Arkansas. As Yunus said in an interview, “Anywhere anybody is rejected by the banking system, you have room for a Grameen-type program.” We set up the Southern Development Bank Corporation in Arkadelphia. The Development Finance Authority put up some of the initial money, but most of it came from corporations that Hillary and I asked to invest in it.