Coalition pushes debt relief for poor countries as economic stimulus

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By Dennis Sadowski Catholic News Service

WASHINGTON (CNS) -- With all that President-elect Barack Obama has facing his new administration regarding the economy, a coalition of religious, human rights and labor advocates hopes that one concern won't be relegated to the bottom of the list: debt relief for the world's poorest countries.

The Jubilee USA Network recognizes that debt relief's profile has declined dramatically from its high point just a few years ago. But the 80 organizations that make up the network know just as well that their advocacy work has kept the issue in front of Congress, the Bush administration and the World Bank, if not in the headlines.

The coalition takes its name from the Jewish tradition of forgiving debt every 50 years, as told in Chapter 25, Verse 10, of the Book of Leviticus:
"This 50th year you shall make sacred by proclaiming liberty in the land for all its inhabitants. It shall be a jubilee for you."

Neil Watkins, Jubilee USA's national coordinator, said the network will be encouraging U.S. officials in the new administration and in Congress to continue their commitments to poor countries at a time when funds for international aid may almost disappear.

"We have this challenge and opportunity," Watkins said. "In a time of scarcity when the budget is going to be directed to U.S. human needs we need to help leaders remember that we also have to think about those in the rest of the world.

"I think it's clear the crisis is going to affect developing countries," he added. "That's going to affect our moral leadership but also our security if this crisis makes life so much worse in developing countries. I think our challenge will be to make the political argument and marshal the constituency to say that a great nation can do two things at once. We can solve the crisis at home, but we also have to take strong measures to help the rest of the world."

Watkins points to the highly successful campaign that led the United States and the World Bank to craft plans canceling debt for 23 of the world's 40 heavily indebted poor countries and reducing it for another 10 nations.

Funds the countries would have used for debt payments are being used for health care, food, education, housing and other development programs, diminishing the impact of the global food crisis, he said.

Now Jubilee USA is looking to expand debt cancellation to the remaining 17 poorest nations. Watkins points to Obama's co-sponsorship in 2008 of the Jubilee Act, which would promote wide relief to poor countries, and efforts by Vice President-elect Joseph Biden to champion the debt-relief cause during his time in the U.S. Senate.

Watkins also is buoyed by a plank in Obama's campaign platform which called for a multilateral approach to reducing debt, allowing poor countries to keep more funds at home for development projects and basic social needs.

Although the Jubilee Act never came up for a vote before Congress closed for business in December, Jubilee USA's member organizations are expecting the bill to be reintroduced early in the 111th Congress.

"We're certainly optimistic," Watkins said.

He and his colleagues are hopeful that the Jubilee Act will provide the framework for Obama to propose widening debt relief at the 2010 summit of the Group of Eight industrialized nations in Huntsville, Ontario.

The G-8 members are Russia, Canada, France, Germany, Italy, Japan, Great Britain and the United States.

Relief for storm-weary Haiti is one Jubilee USA's biggest concerns. Despite being hit by a succession of hurricanes that led to devastating floods during the summer of 2008, Haiti continues making weekly $1 million payments to the World Bank. Jubilee USA plans to push Obama during his first 100 days in the White House to ask the World Bank to cancel the Caribbean country's payments, Watkins said.

Local advocates such as Sister Josie Chrosniak, a Humility of Mary Sister from Cleveland who sits on the national council of Pax Christi USA, said debt relief is vital to the economic well-being of poor countries.

"When countries have to pay back the debt, then what falls aside is the education, the medical help, family care," Sister Josie said. "The country cannot take care of their people when they have to pay back the debt.
Everything they have, and everything they don't have, goes into paying the debt and as a result they have nothing to move their infrastructure forward."

Given that understanding, Jubilee USA has developed a detailed plan outlining several steps the United States can take in promoting wider debt relief as well as sustainable and responsible lending to help turn around the worldwide recession. Watkins said the plan has been presented to the Obama transition team.

"It is the moment to raise the issue now because there's a willingness to question current financial policy," Watkins explained. "We'd ultimately like to see a binding international legal framework saying this is what responsible borrowing involves: transparency, accountability, human rights, civil society and parliamentary participation.

"It's not exactly stuff that jumps off the page, but critical to reform the system so we don't get back into this debt crisis every time there's an economic contraction," he added.

Comments

[DebtEliminationDon]

We have all seen what happens when you give people money and the "moral hazard" is taken away - they do it all over again.

[Debt Help]

Debt Settlement has help many across the country become debt free. No wonder it is one of the most sought after debt relief programs.

http://bedebtfreenow.org

[Debt Relief]

I'm totally agree with Debt Relief programs offered by in charge administration.

Thanks for posting this article, jubileeusa.

[arizona bankruptcy court]

Debt relief is a noble goal, but we really should be teaching/showing/helping these nations to manufacture or farm or something to be a little more self sufficient. It's good for everyone if they do.

[David "Debt Relief" Schmidt]

Long but excellent article. Has there been any new developments since the Obama administration has taken office?