Are Moneylenders Getting Too Much Credit for Farmer Suicides?

Through the blog of the Microcredit Summit Campaign Secretariat, I learned of a spate of articles about Indian farmers committing suicide. Some observers were quick to blame the moneylenders from whom the farmers borrowed to buy water pumps, seeds, and pesticides. Crops failed or grew feebly, and now the farmers cannot repay:

Bharatendu Prakash, from the Organic Farming Association of India, told the Press Association: "Farmers' suicides are increasing due to a vicious circle created by money lenders. They lure farmers to take money but when the crops fail, they are left with no option other than death." (Source.)

Yet I wonder if NPR's Daniel Zwerdling got the story more right in his recent two-part series, the second half of which is "'Green Revolution' Trapping India's Farmers In Debt". Over the last few decades, Indian farmers have pumped water out of the ground faster than the rains replenished it and pests have adapted to pesticides faster than chemical companies have introduced new (affordable) ones. When agriculture is financed by debt, as it so often is, such an environmental tragedy translates into a financial one, then a human one. (And I would not assume that the spike in news coverage indicates a spike in suicides. The problem is long-term and ancient.)The moneylender makes an easy scapegoat. Should we by the same logic blame bondholders for the imminent demise of General Motors?Moneylenders are not angels. Many exploit their monopoly power to charge rates worthy of that old label, usury. And to the extent that capital-intensive and environmentally short-sighted technologies entail more borrowing than traditional or organic methods, farmer indebtedness is more than a sideshow, signifying a fundamental problem in a way of growing food. Still, for me, this example is a reminder of how easy it is to go overboard in blaming the creditor. I will keep that in mind as I write about the ethics of credit.