"Thou shalt sanctify the fiftieth year...and shalt proclaim remission to all the inhabitants of thy land: for it is the year of jubilee." This claim is found in the Old Testament in Leviticus 25:10. It is the premise behind the Jubilee 2000 campaign launched by British Christian based charities to relieve the external debt of developing countries. This ancient holy law was designed to protect the social fabric of the Israelite society; every fifty years creditors would forgive the debtors and farmers would re-claim land they sold to recover from bad years of harvest. Over two thousand years later this law can be seen as comparable to the bankruptcy protection in capitalist societi ...view middle of the document...
This problem is systemic of the relationship between international lending institutions, private and governmental, and the reaction to the structural reforms dictated from the IMF by state governments and the marginalized people who strive for mere survival. Simply put sovereign debt creates social and environmental conditions that in turn demand accruing more debt to address the problems in order to maintain a civil society and a healthy biosphere. Third world debt is not merely an attack on the poor of the South it is an attack on the biosphere and the nascent global civil society by international financiers who are protected under the guise of the Washington Consensus and the IMF. An explanation will come from addressing deforestation and displacement of marginalized people into 'illegal' avenues for economic subsistence, which further exacerbates biosphere destruction. In closing a suggestion for reform to the international monetary system will be offered. Debt has a long history and can be traced back to ancient Sumerians . More recently Sovereigns have largely amassed debt to prepare for or to wage war in the past few hundred years. The repayment of sovereign debt is a political creation with deep historical roots. When the allied victors of WWI sought reparations from Germany they were forced to pay 13-15 percent of their export earnings . This rate was considered extremely high and contributed to the rise of Hitler's fascist Nazi movement. The poverty and indignation from the debt sent Germans looking for a scapegoat for their problems and they found the Jewish people as ample and weak targets and history knows the rest. Now by comparison England's debt after WWII had terms that could be seen as fair and not damaging to British society. The US held most of the British debt from WWII and the repayment terms were calculated with a two- percent interest rate and if payments were to exceed two percent of the British export earnings, interest would be waived . This debt repayment schedule was obviously manageable considering Britain was already an industrialized nation and an experienced hegemon that knew how the international system worked; sovereign debt can be manageable but it depends on the terms. Debts of the developing countries today are out of control from the successive bound and weak regimes that head states, which hold the unforgivable sovereign debt. The IMF suggests that, "As it stands now, countries repay debt even if it is odious because, if they failed to do so, their assets abroad could be seized and their reputations would be tarnished, making it more difficult for them to borrow again or attract foreign investment." This is reasonable at a glance from a creditor point of view but keep in mind the debt service amounts as a percentage of export earnings that led to the rise of Hitler at 13-15 percent. Countries are now paying up to eighty-nine percent of their export earnings to satisfy their creditors ....
