COLUMN: U.S. usury: at what cost?

From Ronald Kim's, "The Wretched of the Earth," Fall '99 From Ronald Kim's, "The Wretched of the Earth," Fall '99As the end of the millennium approaches, an international team of activists, together with U2's Bono and several other celebrities, is organizing a movement called Jubilee 2000. But despite its name, Jubilee is not just another occasion to "party like it's 1999." We are all taught in school that these countries are overpopulated, that famines and natural disasters such as hurricanes present insurmountable obstacles to development and that poverty, civil war, hunger, disease, illiteracy and hopelessness are simply endemic to most of sub-Saharan Africa, or Central America, or the Indian subcontinent. Torn by ethnic strife and military dictatorships, the outlook seems hopeless, almost predetermined. That's the way it's been and that's the way it'll always be. Yet somehow we, the wealthy peoples of the West, still feel a nagging sense of responsibility for these faraway places. Once in a while, when the photographs sent back by journalists bespeak a suffering that only the most heartless or hateful can ignore, we feel moved to "do something." In 1985, Live Aid and "We Are the World" raised some $200 million for Ethiopia's dysfunctional Communist government at the height of the famine in East Africa. All the students at my school sang "We Are the World" and donated two bucks. I was 10 years old and I remember how heroic I felt at the time. That same year, Ethiopia forked over $500 million in debt payments to the U.S. Still feel the same sense of innocent generosity? In the last four decades, the combined debt burden of the underveloped world has exploded from $10 billion to nearly $2 trillion. Today, underdeveloped countries pay some $200 billion a year to the U.S. and Western Europe, but since most of this sum goes toward interest payments, the debt continues to rise at an alarming rate. Some of these nations, particularly in Africa, find themselves saddled with debts exceeding their GNP and devote over a third of their budgets to debt payment. Economic development -- let alone industrialization or acquisition of technology -- is impossible under current conditions. The human dimensions of this tragedy are staggering. Over a billion humans living in poverty, without potable water. Hundreds of millions of seriously malnourished children who won't ever get to attend school. Still, many argue that canceling the debts of poor countries would be "immoral," that it would run against the principles of the free market and endanger the global economy. Leading pan-African nationalist Julius Nyerere has asked whether the Third World must starve its children to pay off its debts. Throughout Africa, Asia and Latin America, governments have done precisely that, spending up to 30 times as much on deficit payments as on education, medicine, or food. Is this not immoral? Nor do I see how canceling, say, Nicaragua's debt would impede the ability of American business to invest in and buy up that war-torn land. Despite its economic hardships, Cuba managed to forgive Nicaragua's debt last year. More importantly, France then followed suit, canceling millions of dollars of unpayable loans dating back decades. Why can't the U.S. do the same? It is easy to blame the Third World for the vise in which it finds itself. Certainly many African, Asian and Latin American governments borrowed much more than they should have in the 1970s, when they thought that favorable economic conditions would last. Much of this money was squandered on weapons, grandiose projects and frivolous imports --much the same way we often buy things on credit that we absolutely don't need. But the policies of the Western powers have greatly exacerbated the predicament of these nations. International institutions like the World Bank and IMF, neutral in theory but U.S.-dominated in practice, have played the key role in forcing the Third World countries to downsize infant industries, slash funding for social services and devote ever greater percentages of expenditures to -- yes -- paying off that unpayable debt. There have been encouraging signs recently, such as the decision of this summer's G8 summit to cancel $90 billion of the debt owed to the industrialized nations. But it will take a much larger sum, and copious assistance from the great powers, to begin to undo decades of damage. With more starvation, wasted lives, political instability, and social unrest and upheaval looming for the immense majority of humanity, no wonder the organizers of Jubilee 2000 aren't celebrating the new millennium just yet.