The following is a common argument used to support increased globalization - expansion of economies beyond national borders.
"Microlending is the key to ending poverty. With microlending, investors make small loans to entrepreneurs in developing countries, so they can start a business and become self-sufficient. In return, the investor has the opportunity to profit from the interest. This helps the impoverished lift themselves out of poverty in a dignified way, instead of having to feel like beggars. To be successful, people need opportunities and the resources to pursue those opportunities. They want to work and are looking for a hand up, not a hand out. Microlending is the answer."
Write a response in which you examine the unstated assumptions of the previous argument. Be sure to explain how the argument depends on the assumptions and what the implications are if the assumptions prove unwarranted.
The author does make a somewhat cogent argument about the benefits of microlending. However, the author's conclusion is based on a number of flawed assumption and a lack of evidence concerning the success, or possible success of microlending.
First of all, the author assumes that everyone who takes micro-loans will be able to start up and run a successful business. The success in return will yield enough profits for entrepreneurs to pay back the loans. The author does not put forward any discussion or elaboration which guarantees the success of start ups. Or it may also be possible that a lot of developing countries may not have a conducive environemnt for start ups. If someone takes a micro-loan, causes and entrepreneurial fiasco and is unable to pay back loans, then neither the entrepreneur nor the investor will end up winning, and people may not rise out of indignation. The author can strengthen his argument by putting an elaboration which would maximise succuess, plus a few accounts which evince this assumption.
Secondly, the author assumes that there will be a lot of people who would take micro-loans, and initiate their own businesses. This would lead to more-loans, and more profits from interest. It may be possible that there may not be a lot of entrepreneurs, and in turn the number of loans taken may be few, which would yield less returns. If there is a dearth of entrepreneurs, then the authors plan for a successful mirco-lending system may not work. If the author can put forward evidence which indicates that there may be a lot of people looking forwards to start their own businesses, he/she may be able to strengthen the argument more.
And finally, since interest and profits are involved, there may be a discrepancy regarding interest rates. For example, investors may opt for higher interest rates, which would ostensibly yield higher profits. However, if interest rates are a bit too high, budding entrepreneurs may be reluctant to borrow money, and thus the author's idea may not work. If the author can provide a suitable range of interest rates that may work both in favor of investors and borrowers, the author's argument for micro-lending may be strengthened.
The author's argument suffers from a paucity of evidence and the holes in the argument. Microlending may be a good idea to pursue if the author is capable of filling the holes left behind, backed up with corroborating accounts