Lifestyles Magazine
July/August 2005

Noreena Hertz - Kicking sand

By David Gerlach

If Noreena Hertz had wanted to play in her nursery school’s sandbox like the other 3-year-olds, everything might have been different. She may have never become a star of the academic world, traveling the globe to sway political and financial leaders to cancel the growing international debt of developing nations or have been able to telephone her friend Bono—the front man of the rock group U2 and one-time Nobel Peace Prize nominee—for support in championing such a cause on the world stage.

Scratch as well all of her her op-ed pieces in The Washington Post, the “star-like” photo shoots and the media’s musings about her stylish outfits—trite trappings that Hertz puts up with for now if that’s what it takes to get her message out. Anyway, that little girl did draw a line in the sand back in the early 1970s. Eventually she would become Professor Hertz. And if she has her way again, this 36-year-old just might change the world.

Hertz’s father, Jonathan, recalls his steadfast toddler refusing to budge from the playground’s sidelines, unwilling to put sand in a bucket and to pour it out, again and again, as the other kids were doing. Her worried teacher asked him and his wife to come to the school. When they asked the young Noreena why she wouldn’t join the other children, she famously replied that she had done it already. The sand in the bucket thing was old hat. There were new challenges ahead. Noreena Hertz notes now that she was already reading, too. Her parents took their daughter to an assessor for a professional opinion. The specialist did not see anything wrong with her, but said, “She shouldn’t be in a nursery school,” as Jonathan recalls from his home in London. “The problem was, she had the mental age of a child of 9. She should have been at school and stimulated and learning.” They decided to enroll Noreena in school a few years ahead of schedule.

Thus began an accelerated academic journey that would lead Hertz to graduate from University College, London, at 19 and earn her M.B.A. at the Wharton School of the University of Pennsylvania just a few years later (at the time, she was Wharton’s youngest enrollee ever). Today she is a distinguished fellow of the Centre for International Business and Management at Cambridge University and is a recently appointed professor of global political economy at the University of Utrecht in the Netherlands. Throughout her education, she would be the curious, smart kid who was always a few years younger than everyone else. But don’t think she morphed into a nerdy recluse or a socially awkward sort. She is anything but. In fact, Hertz is cool. She floats through topics of conversation, transitioning from the connection between international debt, poverty, and terrorism to recounting her games of Scrabble played with fashion photographers and rock stars while unwinding in New York City. She gives the impression that she would certainly make a great co-pilot for a cross-country road trip, game for checking out any oddities or wide-open vistas along the way. Her sweet mix of natural grace, a bouncing giggle, and an endless, welcoming intellect makes you forget that she stands tall against some of the world’s most powerful financial and political figures.

“I grew up in this ultracool home,” Hertz says of her childhood in London. Her parents were established clothing designers in those days; Paul Michael Glaser of Starsky & Hutch fame sported one of their signature cardigans in the television series’ opening sequence. Later on, Hertz’s mother, Leah, left fashion, went back to school, got a Ph.D. in law, and led a campaign to get more women into the British parliament. “She was a woman with more strings to her bow,” Hertz’s father remarks of his now-deceased wife.

Hertz says her family nourished her intellect and academic achievement, as well as the importance of serving the community. Hertz’s father says that his daughter follows in a long line of people “who do things more for others than for themselves.” She smiles while offering up tales of the ready flow of “refugees and waifs and strays” who would pass through the house. “My home really had a kind of social conscience. It was a home that was political...where education was valued. It was also this arch-feminist home.”

These family “seasonings” pepper Hertz’s new book, The Debt Threat: How Debt is Destroying the Developing World. Hertz serves up a cutting look at the international debt crisis. Her straightforward, familiar language unwraps the events that led to the current situation—banks, western nations, the International Monetary Fund, the World Bank, and others loaning millions of dollars to developing nations, sometimes for development causes, sometimes for a leg up in the Cold War—and the populations and countries she feels it now disastrously affects. As an example, Hertz offers the dilemma facing much of Africa. “The world’s poorest region, where 30-million people are HIV/AIDS infected, where 40- million children will lose a parent to AIDS over the next 10 years, is paying out $30 million daily on debt service—monies that could be spent instead on schoolbooks and teachers, doctors and medicines.” Emotion pulses through the language, but Hertz rarely strays from a rational world. Even her most passionate statements are sprinkled with historical facts and calculated figures.

Critics could contend that Hertz stumps with a bleeding heart. Though she leans strongly to the left, she is far from an anti-capitalist. And she coolly replies to this liberal mocking by stating that a large percentage of international aid delivered since World War II has been misused or stolen by corrupt regimes, tyrants, and dictators—the aid rarely making it to the people who sorely needed it. And where the regimes have been toppled, even replaced with democratic governments, the people are still left to clean up the mess of leaders long since deposed. She points out that the world’s major powers—the United States, Japan, Russia, and Western Europe—have recently agreed to erase Iraq’s international debt rung up by Saddam Hussein. With a slight smirk Hertz adds, “but of course, what is good for Saddam should be good for Suharto and Marcos,” calling to name other less press-favored, but equally notorious former dictators of Indonesia and the Philippines, respectively. This same candor sparkles in her more formal speeches as well.

She takes her argument a step further by offering a plausible solution to the problem before it ends up adversely affecting the entire world, as she staunchly believes it will. After a nation’s illegitimate debts are canceled, the reclaimed monies should be directed to national regeneration trusts established in the country. Nongovernmental nationals and representatives from groups such as UNICEF and the World Health Organization should administer the trusts, rather than allowing another string of inept leaders only looking to feed themselves and their armies to control the aid. The trusts would then direct the funds towards health care, education, and infrastructure development. Hertz would also push for a new set of principles for both lenders and borrowers to help squelch any resurgence of the current debt crisis.

Interestingly, Hertz—whose great-grandfather Joseph Herman Hertz was the chief rabbi of England and the Commonwealth from 1913 to 1946 and author of the Soncino Bible—begins her book with a quote from Leviticus 25:10. “And ye shall hallow the fiftieth year, and proclaim liberty throughout all the land unto all the inhabitants thereof: it shall be a jubilee unto you; and ye shall return every man unto his possession, and ye shall return every man unto his family.”

She sees a direct connection between debt relief and religion and believes the Old Testament “is full with this idea that people should be allowed a fresh start.” This moral argument helped enable the Jubilee 2000 debt cancellation campaign to first gain steam back in the late 1990s, she says. Bono, a driving force of that movement, used such sweet talk to bring skeptics like Senator Jesse Helms and Reverand Billy Graham on board. Eventually, this coalition led to a pledge by the United States to cancel all the debts owed the U.S. by the world’s poorest 33 nations.

The idea of tikkun olam—repairing the world—flows through Hertz’s moral justification for debt relief. “This agenda of doing what we can to ensure that people all over the world can be afforded an opportunity to have a decent life is very in line with Jewish teachings,” she says. The chief rabbi of England, Dr. Jonathan Sacks, sent Hertz a letter shortly after The Debt Threat came out. “He said thank you for the book and that it is important for the Jewish community to take this [issue] on board,” she recalls. Hertz hopes other American religious leaders will champion debt relief, as have synagogues and churches in Europe.

Early one February evening, Hertz stood behind a simple podium in a small, volunteer-run bookstore on Manhattan’s Lower East Side. Books on activism and environmental disasters poured from the shelves. It was Hertz’s third or fourth stop promoting her book in the U.S. The previous night she had held court with select Wall Street financiers at a prestigious Upper East Side address. Though the setting had shifted, the same passion propelled her presentation. She seemed at home in both settings. A lively discussion ensued, Hertz listening earnestly as people grappled with the subject. Slowly, a warmth filled the room as her mix of idealism and pragmatism clicked with the assorted cast. Hertz has this way with people. An intellectual arrogance never arises to separate her from the audience.

Joshua Ramo, former foreign editor of TIME magazine, recalls the first time he met Hertz while attending the World Economic Forum annual meeting in 2002. “Even among a collection of ambitious, smart people, Noreena stood out as soon as she opened her mouth. It was impossible to miss the clues of a smart woman with an original mind and a deep passion for changing the world.”

To step beyond the realm of academics and policy leaders, a goal Hertz stresses repeatedly, she utilizes a two-pronged attack. For some, the moral argument can spur action. “Thirty-four thousand children a day are dying from poverty-related disease. For me, that is reason enough to do something about it,” Hertz says with focused eyes. However, Hertz also knows that economic and political reasoning—“the self-interest route”—moves others. So, she will “connect the dots between poverty and terrorism, poverty and extremism, poverty and environmental damage, poverty and diseases that come across borders.” According to Hertz’s detailed plan—one that exudes careful preparation—public understanding and outcry will bring a drastic change in debt policy.

However, lectures, speeches, and books may not be enough to reach the masses. Hertz realizes this and leans on the Hollywood dreams that once filled her head. She wanted to be a film producer and make movies like those “that had shaped the way that I saw the world: One Flew Over the Cuckoo’s Nest, Network.” Though no longer interested in producing major studio productions, she is now developing a film on the debt crisis and the tentacles that are strangling the developing world. “It is another way of getting this message to a different constituency who might not read a book or a newspaper on this subject. Film can be a fantastic way of reaching people.” Her first documentary, The End of Politics, aired on Channel 4 in England in 2001 and complemented her acclaimed tome on globalization, The Silent Takeover: Global Capitalism and the Death of Democracy.

When Hertz was a teen, she got jobs in London’s film industry, like hustling about the city delivering tapes. After graduating from college she headed to Wharton because “it was all M.B.A.s or Harvard Law kids who were getting those coveted jobs in Hollywood.” But Hertz also was drawn by the lure of finance—an area she admits she knew nothing about—and a desire to play with the boys. “It seemed like an important thing to know about and also it seemed like such a kind of guy thing. It was frustrating.” Her fortitude propelled her forward once more.

Her filmmaking plan was unfolding smoothly. Twenty-three and fresh out of business school, she took a job at Triad, which subsequently merged with William Morris, a powerhouse Los Angeles film agency. But before she could get started, she got a call from a Wharton professor asking her to accompany him on a project in Russia. This was just after the fall of Communism. Capitalism was flowering. Naturally, Hertz was ready, having picked up Russian when she was 12. “We had a choice between Russian and home economics—sewing, cooking. In my house, that wasn’t even an option.” This decision to postpone her film aspirations would ultimately change Hertz’s life. She went to Russia for the summer and had “this amazing experience teaching Yeltsin’s advisors how a market economy worked.”

She did return to Hollywood and worked as an agent trainee for a short time. But she soon realized she was not agent material, or at this juncture, even a good secretary. Her penchant for littering her desk with scrawled-upon scraps of paper confirmed this. Even now she pulls out crumbled notes from her purse while searching for a phone number. So, she jumped when another opportunity in Russia called. “My whole motivation was to make films that would change the way people felt about the world. And now I actually had an opportunity to change the world.” Or so she thought.

Hertz moved to Moscow with open, hopeful eyes, helping advise the Russian government on economic reforms while working for the International Finance Corporation, a member of the World Bank. However, she quit a year later as she watched privatization take hold in Russia. To her, it seemed the elites and barons gobbled up the riches while millions in the working class slipped into poverty. She went to Cambridge and began work on a Ph.D., looking at the effects of capitalism and privatization upon Russian society and the general population. Hertz was developing a signature of her shrewd economic thinking, marrying social justice and understanding with sound economic theory.

An opportunity in the Middle East followed where Hertz was able to practice this philosophy. She was hired by the Dutch government to lead a team of Arab and Israeli academics and policy makers in developing prospects for Israeli-Arab economic cooperation. Now in her late 20s, Hertz returned to Cambridge to teach classes in the M.B.A. program. She hoped to instill a responsibility to both the bottom line and the people and countries affected by business decisions. Hertz also found time to write The Silent Takeover, which would propel her from a rising academic mind to a leading voice on globalization.

Shortly after that book’s publication, Hertz was invited to sit on a panel on globalization with President Bill Clinton and Mary Robinson, formerly United Nations High Commissioner for Human Rights. “That was kind of the start of this much more political and public journey,” she says, a giddy excitement slipping out. Even now, when engagements regularly keep Hertz away from her London apartment for weeks at a time, she still marvels at the ride. It is a journey where she interacts with people at the prime minister and CEO level, but also “with loads of activists, from rooms of 10 people to crowds of 3,000 people.”

While she does move amongst quite varied company, Hertz’s theories do face criticism. The venerable Guardian, a newspaper for which Hertz regularly writes commentary and which has sponsored many of her lectures, published a less than kind review of The Debt Threat. The writer noted that her book contained little that was radical and that “her arguments might be more compelling if the book were not littered with errors.” Hertz laughs at this slight—“the left hates its own in Britain,” she says. Beyond this unexpected challenge and the expected rejection of her ideas as unrealistic, utopian dreams, many opponents say aiding developing nations would simply absolve them of financial responsibility. While on C-SPAN’s Washington Journal in February 2005, some callers to the show felt developing nations would merely squander these reclaimed funds just as they had misused foreign aid for years. Another caller attacked Hertz personally, bemoaning the fact that a foreigner was telling the United States what to do. She kindly directed Hertz to skip back across the proverbial pond. Hertz sat quietly, took notes of the caller’s displeasure, and then shot back.

“Thank you for your hospitality. This is a fantastic country, a country that has values and principles that can provide an amazing model for the rest of this world. And this country actually is incredibly generous when it comes to private giving. But in terms of aid and the percentage of gross domestic product, the U.S. isn’t pulling its weight in the way that it could, which is really sad. It can give so much and play a fantastic role in the world. I don’t want to romanticize Europe, but we can collectively do something for a better world not only for us, but for future generations.” With that, she turned to the next caller. The performance was classic Hertz.

She rejects much of the harsh criticism of her prescriptions because she staunchly believes in the process she used to write this book. “The top people in the world looked at this during the writing process. Chapters were going out across the world for comments and feedback.”

Much of her healthy certitude comes directly from her mother. Hertz was 20 when she died. “I think she really taught us and through her examples to be true to yourself...to maintain integrity of what I believe and what I stand for.” It has proven helpful as she finds herself alone in a male-dominated sea of academics and politicos. One day she hopes to see more women by her side.

In addition, her mother offered a brilliant example of merging the professional and personal realms of life. When asked if it is hard to have a relationship and maintain such a busy career, she responds brilliantly: “Not with the right person.” A romantic glow washes over her. She muses about wanting a guy to love “and kids born out of the loving, happy union.” Though she knows not to be greedy with such a shining career, she does want the happiness and balance that her mother and father shared. Suddenly, she comes back from the clouds. The tone shifts to the offensive. “They don’t make any issue of a guy and what he is wearing and if he can reconcile his private life with his work life.”

Hertz wants to change the rules of play, wants to kick some sand out of the world’s sandbox. The odds are surely in her favor.

© 2005 david gerlach- info@dgerlach.com