This drama has been playing on the world stage for years--but the global stand-off is finally ending.
Late last month, White House and Congressional negotiators agreed to allocate $435 million toward a proposed $90 billion package of debt relief for impoverished developing-world countries. President Clinton signed this allocation into law early this month. The decision breaks an important logjam: It puts Congress on record as agreeing with the basic idea of Jubilee--that debts of the poorest nations, mainly in Africa, should be excused.
"The debt relief issue is now a speeding train," said Rep. Sonny Callahan, (R-Alabama), ranking member on the House committee that controls the foreign aid budget, after one of the votes. "We've got the pope and every missionary in the world involved, and they persuaded just about everyone here that this is the noble thing to do."
The agreement is a milestone achievement for the Jubilee 2000 movement. Founded by an unusual coalition of Catholic theologians, evangelical Protestants, and left-wing anti-globalization activists, Jubilee 2000--backed by figures as diverse as John Paul II, Pat Robertson, and the rock musician Bono--hopes to persuade Western nations to erase at least $90 billion and perhaps as much as $220 billion in developing-world debt. This might invigorate the economies of impoverished nations and, potentially, save millions of lives by allowing poor countries to shift funds from debt service to immediate needs, mainly health care.
Here's the background. Roughly from the 1960s through the 1980s, many developing nations acquired substantial foreign debt, through the World Bank and the International Monetary Fund and at times commercial banks as well. Some borrowing was used to finance important projects such as infrastructure improvements; some went to white-elephant projects; large chunks of the proceeds were simply stolen by the corrupt "kleptocracies" that run many developing nations.
Developing nations with growth economies, especially in Asia, have done relatively well in repaying their debts. But the 41 countries (33 of them in Africa) that the World Bank calls "heavily indebted poor nations" have found their economies hard-hit by debt-service payments. These nations have no realistic prospect of satisfying their creditors and are at best a generation away from establishing the sort of growth economies that would generate revenue--creating trade. In the poorest nations, foreign debt has become a factor in human misery; for instance, many African nations cannot afford AIDS drugs and debt repayment at the same time.
It was once thought that biblical jubilees, described in Leviticus 25, were some kind of cyclical festival system. Lately, scholars have begun to argue that the jubilee was essential to the functioning of ancient economies. Archaic interest-charging systems were cumulative: Interest payments on money or land increased every year, meaning loans were essentially impossible to satisfy. Typically, farmers would borrow by mortgaging land or property at interest that rose 3% per annum; such loans could rarely be repaid, meaning the property would eventually default to the lender. This punitive system of borrowing is why the Old Testament and Qur'an call interest sinful. Jubilees, economists now believe, were devised in order to prevent all wealth of ancient desert societies from ending up in a few hands, stifling economic activity; cancelling debts reshuffles the economic deck, granting the disenfranchised an incentive to work hard and acquire property. The parallels to today's situation with the impoverished developing world are obvious.
In recent years the Jubilee movement has found its strongest backing from the Catholic Church, where John Paul II is an ardent supporter of debt relief as a moral imperative; from evangelical developing-world aid organizations such as World Vision, who see debt relief as a prerequisite for establishing growth economies in Africa; from an ever-increasing number of religious conservatives, who see debt relief as necessary to follow the biblical injunction to aid the poor (America is "under the judgment of God" because it is not giving enough to the world's impoverished, the popular revival preacher Tony Campolo recently said); from mainline Protestants, who have pressed the issue through the mainline National Council of Churches and through Church World Service; and from anti-globalization activists, who find anything having to do with the World Bank to be sinister.
The first major victory for the Jubilee movement came in 1999, when President Clinton and the other G7 leaders, at a summit at Cologne, agreed to cancel outright $27 billion in developing-world debt, and to seek funds to forgive about $90 billion in international loans owed by the poorest nations. Clinton became a convert to the Jubilee idea, saying, "As the richest country in the world, we have a moral imperative to help the very poorest nations." Clinton made appearances with Jubilee supporters, memorably having Pat Robertson and Bono to the same White House session on the issue. (It's not known whether Robertson is a U2 fan, but surely he must have asked Bono for advice on where to buy earrings.) Clinton also stressed, in negotiations with Congress, that debt relief for nations without economic growth was supported by economists.
This initial victory for the Jubilee movement came following a fusillade of grassroots tactics, including petitions, human chains at the summit, constant lobbying, and, at one point, a Jubilee musical touring the United States and European Union as street theater. It wasn't Rodgers and Hammerstein, though it seemed to make the point.