The Jubilee Blog

Senate Budget Action Fails to Repeal Tax Transparency Law

By Sophia Har 

Budget amendment SA 621, to repeal the Foreign Account Tax Compliance Act (FATCA), failed to reach the the US Senate floor for a vote on Friday. FATCA was originally passed in 2010 to prevent corrupt activities and Americans from evading taxes abroad. The law requires foreign financial institutions to disclose financial information or face penalties.

"It's an unpopular idea to overturn existing tax transparency laws in the Senate," said Eric LeCompte, executive director of the financial reform organization Jubilee USA Network, which generated thousands of phone calls into the Senate in support of FATCA. "The lack of support for repealing FATCA shows how important anti-corruption legislation is to Congress."

Countries and financial institutions that sign FATCA compliance agreements with the US government agree to automatically share certain tax information. To date, over 77,000 banks and 80 countries have signed such agreements. In 2013, G8 leaders pledged to crack down on tax avoidance and improve transparency by working toward a global version of FATCA. The G20 that year agreed to automatically exchange information by the end of 2015 and called such exchange "the new standard." In 2014, 47 countries agreed to a global standard of information exchange developed by the Organization for Economic Cooperation and Development.

"FATCA is part of a global campaign for financial transparency," noted LeCompte.

Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org

Vulture Activity on the Rise

A great piece written by Aldo Caliari, our Board Co-chair and Director of Rethinking Bretton Woods Project, on RightingFinance. 

By Aldo Caliari 

At its 14th session, last February, the Human Rights Council Advisory Committee (“the Advisory Committee”) addressed for the first time the impacts of so-called vulture funds on human rights. “Vulture fund” is a generic name used to designate financial entities that use as a profit-making strategy the purchase of distressed debt owed by a sovereign debtor – that is, a State- on the cheap with the purpose of suing for the full amount once conditions for repayment improve. 

Read the full story here.

Unsustainable Debt Levels Rise in Africa

Our partners at AFRODAD are warning that Africa's debt levels are rising and that they are unsustainable. Debt crowds out spending on important social priorities like health and education, a reality the world is witnessing all too clearly as Ebola continues to devastate Guinea, Sierra Leone and Liberia. Below is media coverage of AFRODAD's excellent work on this issue:

Dr. Fanwell Kenala Bokosi, Executive Director of The African Forum and Network on Debt and Development (AFRODAD) -- a civil society organisation that advocates for debt cancellation, has described Africa’s rising debt as “unsustainable.”

Read the rest of the story here.

Ebola Debt Relief and the Philippines

Great blog from our friends at the Columban Center. 

By Zach Alles

Proclaim Jubilee! Leviticus 25 describes the biblical Jubilee as a “Sabbath of Sabbaths,” requiring the land lie fallow, all debts be forgiven, captives be freed, and a celebration held, once every 50 years.

Continue reading...

Pope Francis Celebrates Two-Year Anniversary as Leader of Catholic Church

Pontiff's Teachings Focus on Inequality

By Sophia Har 

March 13 marks the second anniversary of the election of Pope Francis. After two years as leader of the world's 1.2 billion Catholics, Pope Francis has made poverty and inequality central themes in his papacy. The Catholic Church was a principle founder of Jubilee USA Network, a faith-based campaign that focuses on inequality that won billions of dollars in debt relief for poor countries. Jubilee USA's Executive Director met Pope Francis last May and engages in high-level talks with the Vatican Secretary of State and senior officials on debt, tax and financial issues.

Eric LeCompte, Executive Director of the religious anti-poverty organization Jubilee USA Network and an expert to United Nations finance working groups, releases the following statement:

"Poverty and inequality have always been important aspects of Catholic teaching. What sets Pope Francis apart from his predecessors is that he has made these central issues of his papacy. 

President Obama Introduces "Student Aid Bill of Rights"

New Rules Protect Students from Predatory Behavior

By Sophia Har

President Obama signed by executive order a "Student Aid Bill of Rights." These reforms are meant to protect the average college student who graduates with $29,400 in student debt. The initiative includes new rules requiring third-party lenders to inform students of alternative repayment options and a new website where students can file complaints against lenders.

"These actions to protect students are a welcome step," said Eric LeCompte, executive director of the religious debt relief organization Jubilee USA Network. "Student debt in the United States surpasses $1 trillion."

Jubilee USA Network, founded by mainline Christian Churches and Jewish Synagogues, won over $130 billion in debt relief for poor economies since the late 1990s. The organization over the last 3 years has led successful campaigns with over 100 churches and synagogues to keep federal loan interest rates manageable.

"These new rules push back the predatory groups who seek to take advantage of our students," noted LeCompte. "The future of generations depends on responsible lending and borrowing."

Sophia Har is the Communications Director at Jubilee USA Network. Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. www.jubileeusa.org

WORLD BANK ANNOUNCES FAILURE IN MONITORING DEVELOPMENT PROJECTS

By Andrew Hanauer

 

The World Bank just announced that it did not properly monitor resettlement projects connected to World Bank-funded development programs. The news agency Reuters reported that the Bank "had no idea how many people may have been forced off their land and lost their jobs due to its projects in developing countries, and whether these people were compensated fairly and on time."

 

This announcement is a reminder of the urgency of implementing responsible lending and borrowing principles at international financial institutions like the World Bank and International Monetary Fund. Responsible Lending and Borrowing is a key component in addressing poverty, protecting poor communities from unsustainable debt burdens, harmful loans to repressive regimes and the unintended consequences of large development projects. Jubilee USA is at the forefront of promoting responsible lending and borrowing and played a significant role in developing the United Nations Conference on Trade and Development's (UNCTAD) major report on the topic. 

 

Development projects that displace whole communities are a perfect example of the problem. The World Bank's internal auditor found that the Bank's projects weren't directly linked to intimidation and harassment of evicted residents, but that the Bank didn't plan to properly mitigate risk. Lenders, like borrowers, have a responsibility to ensure that their loans do not bring harm to a community. As the World Bank announces plans to address the problems, Jubilee will continue to advocate for enshrining responsibility in the lending practices of major financial institutions.

 

Jubilee Talks Debt Crisis in Greece

By Sumi Yi 

Greece, the world's third most indebted country, sought to extend its loan by six months. Last week, Greece was able to negotiate a deal with the Eurozone to secure a four-month bailout extension. 

On Wednesday, February 25 Jubilee's Executive Director Eric LeCompte discussed the debt crisis in Greece and the steps needed to be taken to address Greece's financial crisis. He highlighted the importance of understanding the role of the IMF and the issues of debt relief, tax justice and debt restructuring. Listen to Eric's interview here.