It's currently a rough draft, so there are some rough edges on it as you may notice (like the conclusion). Any help is appreciated. The language is Canadian English, in case you notice any discrepencies in spelling.
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In John Dalla Costa?s Forgive Us Our Debts, the issue of debts crippling effects on impoverished nations is explored. The main issues raised in the film are: the consequences of debts in impoverished nations, how the debts came about, the legitimacy (or lack thereof) of the debts, and some of the more prominent debt relief movements.
The consequences of debts are devastating the countries that bear them. As a result of their sizeable debts, impoverished nations are unable to develop or improve essential services like health care and education. In Nicaragua, as a result of crippling debts, there is not enough money to satisfy the educational needs of all Nicaraguan children. It has been estimated that Nicaragua needs more than 10,000 new classrooms for the more than 1 million children who have no school to attend. In her lecture, Molly Kane highlighted how debt repayment causes a diversion of economic resources and a consequential intensification of impoverishment. As impoverished nations pay substantial portions of tax revenue towards their debts, there is a diversion of resources away from necessary domestic projects (like health care and education) towards the pockets of the already wealthy North. This diversion of economic resources prevents the most basic services ? like water, and basic health care - from being offered to a country?s citizens, which ultimately intensifies the plight of the impoverished.
When an individual or a country borrows money, they have an obligation to pay it back. However, the debt burdens on many impoverished countries can not be looked at in such a simplistic manner. In the sixties and seventies banks were, as Molly Kane mentioned, awash in money from OPEC. This money (which is often referred to as ?petrol dollars?) was lent to developing countries for ?completely unviable economic programs, some of them just grotesque.? In 1980, developing countries owed $568 billion USD in debt. Later in the 1980s a global recession hit; interest rates skyrocketed, yet the price for staples of developing nation?s economies (exported commodities like coffee and sugar) collapsed. Consequently, in 1997, developing nations held nearly four times as much debt as they had in 1980, a grand total of $2 trillion dollars. Unfortunately, as a result of these debts, many countries have fallen into a ?debt trap?. The ?debt trap? refers to the need to borrow money in order to service (pay the interest) on a debt. The debt trap clearly demonstrates that the debt issue will not solve itself, in fact, if anything the issue is worsening.
The legitimacy of the debts many of these impoverished nations bear should be called into question when we examine the wanton lending habits creditors engaged in. As Molly Kane mentioned, bankers engaged in ?aggressive, irresponsible lending? and often the money that was lent to these nations never benefited the people who now pay for it. It would often be used to purchase arms in order to shore up oppressive regimes. Ultimately, the dictators that racked up massive debts for these nations have not been held accountable; instead, it is the poorest members of society who must ?pay the price for their own oppression.?
In recent years there has been some progress towards debt relief for impoverished nations. ?HIPC? (Heavily Indebted Poor Countries initiative) has aimed to deal with the debt issue in a comprehensive manner. Unfortunately, HIPC requires that participating nations employ macroeconomic policies referred to as ?structural adjustment programs.? As well intended as these policies may be, their effects on participating economies are devastating. ?There is a correlation between countries that have been under structural adjustment for the longest time, and an increase in their debt burden.? Structural adjustment is fundamentally flawed as it ?prioritizes debt repayment over development. Countries are not free to spend as they would like, and as they need to.? By gearing their economies toward export production, as per the rules of SAP (structural adjustment programs), there is a consequential rise in the presence of mono-crop agriculture, and sweat shop labour. Another less intrusive debt cancellation movement is known as ?Jubilee 2000.? ?Jubilee 2000? is a movement which aims to offer complete debt relief to the most indebted nations. While ?Jubilee 2000? has received a groundswell of support, creditors have unfortunately been unwilling to oblige with the goals of Jubilee. Creditors (like the IMF and World Bank) have supported a Jubilee ?that really keeps these countries on the hook. It keeps them paying debt; it keeps them making debt service payments to the North. And it keeps them enslaved by structural adjustment conditionality.?
The consequences of debts can not be argued. It is very clear that the excruciating poverty which is present in impoverished nations is a consequence of the enormous debt burdens they carry. However, creditors must take a more reasonable approach to solve the problem. If creditors are not willing to offer unequivocal debt relief, they must be willing to embrace solutions that do not have economically intrusive clauses, like structural adjustment.
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In John Dalla Costa?s Forgive Us Our Debts, the issue of debts crippling effects on impoverished nations is explored. The main issues raised in the film are: the consequences of debts in impoverished nations, how the debts came about, the legitimacy (or lack thereof) of the debts, and some of the more prominent debt relief movements.
The consequences of debts are devastating the countries that bear them. As a result of their sizeable debts, impoverished nations are unable to develop or improve essential services like health care and education. In Nicaragua, as a result of crippling debts, there is not enough money to satisfy the educational needs of all Nicaraguan children. It has been estimated that Nicaragua needs more than 10,000 new classrooms for the more than 1 million children who have no school to attend. In her lecture, Molly Kane highlighted how debt repayment causes a diversion of economic resources and a consequential intensification of impoverishment. As impoverished nations pay substantial portions of tax revenue towards their debts, there is a diversion of resources away from necessary domestic projects (like health care and education) towards the pockets of the already wealthy North. This diversion of economic resources prevents the most basic services ? like water, and basic health care - from being offered to a country?s citizens, which ultimately intensifies the plight of the impoverished.
When an individual or a country borrows money, they have an obligation to pay it back. However, the debt burdens on many impoverished countries can not be looked at in such a simplistic manner. In the sixties and seventies banks were, as Molly Kane mentioned, awash in money from OPEC. This money (which is often referred to as ?petrol dollars?) was lent to developing countries for ?completely unviable economic programs, some of them just grotesque.? In 1980, developing countries owed $568 billion USD in debt. Later in the 1980s a global recession hit; interest rates skyrocketed, yet the price for staples of developing nation?s economies (exported commodities like coffee and sugar) collapsed. Consequently, in 1997, developing nations held nearly four times as much debt as they had in 1980, a grand total of $2 trillion dollars. Unfortunately, as a result of these debts, many countries have fallen into a ?debt trap?. The ?debt trap? refers to the need to borrow money in order to service (pay the interest) on a debt. The debt trap clearly demonstrates that the debt issue will not solve itself, in fact, if anything the issue is worsening.
The legitimacy of the debts many of these impoverished nations bear should be called into question when we examine the wanton lending habits creditors engaged in. As Molly Kane mentioned, bankers engaged in ?aggressive, irresponsible lending? and often the money that was lent to these nations never benefited the people who now pay for it. It would often be used to purchase arms in order to shore up oppressive regimes. Ultimately, the dictators that racked up massive debts for these nations have not been held accountable; instead, it is the poorest members of society who must ?pay the price for their own oppression.?
In recent years there has been some progress towards debt relief for impoverished nations. ?HIPC? (Heavily Indebted Poor Countries initiative) has aimed to deal with the debt issue in a comprehensive manner. Unfortunately, HIPC requires that participating nations employ macroeconomic policies referred to as ?structural adjustment programs.? As well intended as these policies may be, their effects on participating economies are devastating. ?There is a correlation between countries that have been under structural adjustment for the longest time, and an increase in their debt burden.? Structural adjustment is fundamentally flawed as it ?prioritizes debt repayment over development. Countries are not free to spend as they would like, and as they need to.? By gearing their economies toward export production, as per the rules of SAP (structural adjustment programs), there is a consequential rise in the presence of mono-crop agriculture, and sweat shop labour. Another less intrusive debt cancellation movement is known as ?Jubilee 2000.? ?Jubilee 2000? is a movement which aims to offer complete debt relief to the most indebted nations. While ?Jubilee 2000? has received a groundswell of support, creditors have unfortunately been unwilling to oblige with the goals of Jubilee. Creditors (like the IMF and World Bank) have supported a Jubilee ?that really keeps these countries on the hook. It keeps them paying debt; it keeps them making debt service payments to the North. And it keeps them enslaved by structural adjustment conditionality.?
The consequences of debts can not be argued. It is very clear that the excruciating poverty which is present in impoverished nations is a consequence of the enormous debt burdens they carry. However, creditors must take a more reasonable approach to solve the problem. If creditors are not willing to offer unequivocal debt relief, they must be willing to embrace solutions that do not have economically intrusive clauses, like structural adjustment.
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