Sure, subprime loans toppled two pillars of American investment banking, gutted the world’s largest insurer, and plunged the entire US financial system into a tailspin. But they are exactly what the world needs today, Daniel Gross argues in Slate. “Far from the madding, depressed crowds of Wall Street, billions of people are starving for credit,” the columnist writes.
Small loans help fight worldwide poverty, but the trick is figuring out what borrowers can afford to pay back. “We need loan officers with a banker's head, a social worker's heart, and the stamina of a distance runner,” said one microlender. With new technologies that boost access to credit, nations only need to foster an entrepreneurial system—if America's hasn't scared them off yet.