The Jubilee Blog

Stand Up & Be Counted

By Hayley Hathaway

Stand up. Get up from your chair, your sofa, the floor, or your bed right now. 

Now imagine 117 million people all around the world, on every continent, standing up at the same time. This weekend, that’s what’s going to happen.

More than one hundred million people are taking a stand this weekend against global poverty as part of the Stand Up and Take Action Days. While many of us work on poverty issues everyday, talk about it at home and in our communities, once a year we have the opportunity to literally stand in solidarity with people across the world at the same time – all people who care about ending poverty once and for all.

Almost 10 years ago, world leaders committed to a bold roadmap to end global poverty and its root causes – beginning with achieving the Millennium Development Goals which include eradicating extreme poverty and hunger, improving maternal health and ensuring environmental sustainability by 2015. This weekend we are all coming together because we know that despite the gains we’ve made, the global economic crisis is threatening our progress.     

At Jubilee USA Network, our almost 100 Stand Up events across the country are focusing on one part of the poverty puzzle: debt cancellation and responsible lending. Without debt cancellation, we will not reach the Millennium Development Goals in time. Right now the world’s poorest countries pay rich creditors more than $100 million in debt payments everyday. Can you imagine if this money went toward shelter, education and health care?  

We know that it is possible. Debt cancellation has already brought increased education, healthcare and vital social services for many countries in Africa and Latin America. But too many needy countries have been left out.

This weekend, churches, synagogues and community groups will by taking the Stand Up Pledge to reach the Millennium Development Goals by 2015. They’ll also urging Congress to support the Jubilee Act, a bill which calls for expanded debt cancellation to help all the poor countries that need it to reach the MDGs.

This weekend, all over the world we are going to pledge our commitments to fighting global poverty. Let's continue to work to break the chains of international debt.

To learn more about Stand Up and to find out how YOU can stand up, visit www.jubileeusa.org

The Sumatra Earthquake: A Humanitarian Crisis

By Kristin Sundell

On September 30^th, a 7.9 magnitude earthquake devastated western Sumatra, killing upwards of 3,000  people.  Hundreds of schools were flattened along with tens of thousands of other public buildings.  In Padang, a city of 900,000 people near the epicenter of the earthquake, nearly all of the buildings were damaged and roughly a quarter were demolished.

Indonesian government officials have estimated that at least $600 million will be needed to repair basic infrastructure damaged by the earthquake.  Countries around the world have pledged and sent humanitarian assistance, but it is not enough to enable Indonesia to rebuild.  Meanwhile, Indonesia continues to send almost $9 billion every year to foreign governments and international financial institutions in payment on its foreign debt.

West Sumatra sits on one of the world’s most volatile fault lines, the same one responsible for the tragic earthquake and tsunami of December 2004, which killed over 200,000 people in 11 countries.  Geologists say that the region will experience an even deadlier earthquake in the coming years.  It is essential that the necessary resources are invested now to ensure that homes and public buildings can withstand future earthquakes.  Jubilee colleagues in Indonesia, including the Koalisi Anti-Utang (KAU/Anti-Debt Coalition) are calling on the Indonesian government to reallocate the money currently slated for debt repayment to finance reconstruction and to prepare for future disasters.  They are also urging the Indonesian government not to take on new loans to finance disaster response.  According to KAU Chairman Dani Setiawan, “Addition of new debt will only add to the burden on the state budget and preserve creditor intervention in economic policy making and Indonesian politics.”

When we hear of a natural catastrophe somewhere in the world, our first impulse is often to pull out our wallets.  Direct assistance to western Sumatra is definitely needed, but as Jubilee activists we must also amplify the voices and support the calls of our Southern partners by advocating for change in our government’s positions.  At minimum, the United States should support the complete suspension of Indonesia’s international debt payments until the country has fully recovered from the September 30 earthquake.  All international assistance in response to the disaster should come in the form of direct support or grants rather than additional loans. 

Beyond the current humanitarian crisis, Indonesia’s debt should have been cancelled long ago on grounds of odiousness.  Indonesia’s tremendous debt burden dates back to the brutal and corrupt Suharto dictatorship.  According to a 1997 leaked World Bank memorandum on corruption in Indonesia, World Bank resident staff believe that at least 20 – 30% of Indonesian development budget funds were siphoned off into the private accounts of the Suharto family and other government employees.  The memo also states that World Bank controls had “little practical effect” on such corrupt practices.  Despite these findings, the lending continued and the odiousness of Indonesia’s debt has never been addressed.   

Same Game, New Rules

By Julia Dowling

During the G-20 meetings in the spring, the IMF received a massive infusion of cash as a solution to the disproportionate affect the economic crisis is having on poor countries.  In response to this and the current World Bank/IMF meetings in Turkey, our colleagues at Eurodad have produced "Debt in the Downturn," a report with worrying conclusions.

28 countries now have “unsustainable debts,” meaning they do not have a large enough GNP pay their monthly debt bills.  The United Nations Conference on Trade and Development has an even darker outlook: 49 of the poorest countries in the world are showing serious signs of debt distress, and are at risk for a renewed debt crisis like that of the 1980s.  All this comes just as the World Bank and IMF are increasing their lending to middle and low income countries.

It’s become quite clear from the global economic crisis that it was irresponsible lending that got us into trouble, so why are the most powerful countries counting on more IMF and World Bank loans to bail us out?  Yes, these loans do put more money right now into the hands of governments hurting the most, but the long-term harm coming from deep indebtedness is simply not worth the benefits.

 

How did the G-20 excuse their decisions despite civil society’s clear objections before, during, and after the summit?  The Eurodad summary explains that, “To justify its stepped-up official lending programme, rich country governments have pressed the World Bank and IMF to re-write their rules on debt sustainability.”  Instead of addressing root causes of poverty and indebtedness of poor countries, the G-20 put a big, $500 billion bandage on the problem. 

Instead, the US should treat the cause of the wound by demanding real World Bank and IMF reform. We want a new game, in which everyone wins.  In this way, we might be able to both prevent a renewed debt crisis and fix the problems we’ve set out to fix—crushing poverty only made worse by the economic crisis.    

 

To read the full report, go to Eurodad’s website.