July 11, 2006

FORGIVE US OUR DEBTS, PART II: JUBILEE


Caption: This man is a bad credit risk.

This is the second post in a series about issues related to international, national, and personal debt.

Debt relief, like justice for the poor and for those who labor, is a key theme of the Hebrew Bible. Essentially, it grows from the Exodus experience of the liberation of Hebrew slaves from bondage in Egypt.

The Torah, or first five books of the Bible which constitute the foundation of Jewish law, provides for periodic cancellation of debts every seventh year, which was a Sabbath Year (Deuteronomy 15). The intent clearly seems to be to prevent the formation and hardening of a permanent class system.

Every 50th year was to be a year of Jubilee in which slaves were to be freed, debts cancelled, the land was to lie fallow and the land was to be redistributed to its original holders.

As Leviticus puts it, "And ye shall hallow the fiftieth year, and proclaim liberty throughout all the land unto 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." (25:10)

This ancient idea helped inspire what was previously called Jubilee 2000, one of the most successful social movements of recent years. This campaign and similar efforts called for the cancellation of the debts of the world's poorest nations.

Many of these countries, which suffered from the legacy of colonialism and sometimes of undemocratic and authoritarian governments, were pressured to borrow from wealthier nations and international financial institutions for development projects. These loans often profited elites in the borrowing and lending countries but brought little or no benefit--and sometimes great harm--to ordinary people.

As the debt mounted, countries would often have to keep borrowing to simply pay the interest on earlier loans. Institutions like the World Bank and International Monetary Fund then imposed harsh structural adjustment programs (SAPS) which forced austerity measures such as privatization and cuts to health, education, and social programs on people who were already desperately poor. For millions of the world's poor, there was no way out.

At the time the debt cancellation movement began in the 1990s, most people with an inclination to bet would have given pretty slim odds for any chance of success, but the movement has grown substantially and has impacted the policies of the world's wealthiest nations which comprise the G8, as well as the World Bank, the International Monetary Fund, and other international financial institutions.

In July 2005, the G8 agreed to 100 percent cancellation of the debt of 14 impoverished countries in Africa and four in Latin America (one, Mauritania, has since been dropped from the deal). While many in the debt cancellation movement were disappointed about the extent of the relief in light of the human crisis in highly indebted countries, it is highly unlikely that this step would have been taken without movement pressure.

Next time: a look at debt in Africa.

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