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Globalization/Debt Strategy Paper
Statements of Understanding of the Historical Context of Debt
We believe that:
* The colonization of Latin America and the Caribbean by the North destroyed
cultures by debasing the civilizations of Latin America and the Caribbean
in order to justify colonization.
* Colonization resulted in the enslavement of indigenous peoples.
* The environment of Latin America and the Caribbean is being destroyed
as a result of the economy of colonialism which includes clearing large
tracts of natural forest to create large export-production plantations
and the export of natural resources. The destruction of the environment
has been perpetuated by post-colonial capitalist trading relationships
with former imperial powers.
* As a result of the colonial economy many Latin American and Caribbean
countries' own economies are export-oriented and focused on the sale of
natural resources such as tropical produce, oil, etc.
* Colonialism and neo-colonialism created a
South-North economic dependency that forces Latin American and Caribbean
countries to accept loans from bilateral and multilateral funding sources
in order to be able to compete in an increasingly global economy with
declining terms of trade.
Statements of Understanding of the Illegitimacy of Debt
We believe that:
* Debts were incurred with the use of fraud, bribery, and coercion.
* Loans were given to corrupt, dictatorial, and repressive governments.
Loans were also given to democratically elected governments that were
equally corrupt and repressive as dictators.
* Lenders have also been corrupt and that lenders are culpable for loans
made to known corrupt and dictatorial governments.
* In many cases, loan funds to countries in Latin America and the Caribbean
were stolen by corrupt officials.
* Loans to countries in Latin America and the Caribbean were often linked
to large-scale projects that have proved detrimental to the environment,
economy, political situation and social fabric of the host country, or
projects which endangered the health of the population of the host country.
* Much of the debt of Latin America and the Caribbean was contracted
by private corporations and passed on to governments, and in many of these
cases, the funds were pocketed or wasted.
* The debts have actually been paid many times over by people in the
Caribbean and Latin America. In financial and economic terms, the interest
accumulated on debt has inflated the amount paid and owed by countries
to well beyond the original value of the loans themselves. The peoples
of Latin America and the Caribbean have also paid the debt in human, social
and environmental terms.
* Debt was often contracted secretly without civil society scrutiny.
* Debt has often undermined the consolidation of the national democratic
process.
* Debt has endangered the national capacities of food security and sustainability
in Latin America and the Caribbean.
* The payment on debts have provoked human rights violations.
Statements of Understanding of the Direct and Indirect Effects of Debt
We believe:
* In exchange for debt relief, Latin American and Caribbean countries
entered into agreements with the international financial institutions
(IFIs) that included a set of conditions commonly known as structural
adjustment programs (SAPs).
* Debt and SAPs are the leading cause of the degradation of health, nutrition,
food security, education, and the environment. SAPs require national governments
to prioritize debt payments over human needs. In addition, SAP conditions
follow a basic neoliberal model which does not consider the uniqueness
of any country and often has deleterious effects on the economy, labor
rights, and the national standard of living.
* By promoting economic programs that prioritize adhesion to a neoliberal
economic model over human needs, debt and SAPs aggravate unemployment,
ecological degradation, and regional conflict. On a grassroots level,
these programs also contribute to the disintegration of families, which
leads to juvenile delinquency and prostitution, and the worsening of women’s
socio-economic conditions and daily life.
* Debt and SAPs increase poverty in Latin America and the Caribbean.
* The increase in poverty and decrease in purchasing power weakens innovative
and entrepreneurial capacities and weakens small and medium businesses
and farms.
* The increase in poverty in Latin America and the Caribbean leads to
increases in migration between countries and to the North, the increase
in drug trafficking as a source of income, money laundering, and other
forms of "transnational crime."
* Debt is used as a mechanism of oppression.
* Debt eliminates the national sovereignty of the countries in Latin
America and the Caribbean while increasing the political and economic
subordination of the international financial institutions and the transnational
corporations.
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Statements of Understanding of the Purpose of Debt
We believe:
* It benefits the elite in countries in the Global North and IFIs to
keep countries in Latin America and the Caribbean indebted and it is essential
to the Northern system of capitalism to do this.
* Countries in the Global North and IFIs are able to assert economic
control over countries in the Global South through SAPs.
* Debt and SAPs benefit countries in the Global North, local elites,
and the IFIs because they:
1) deconstruct trade barriers;
2) open markets in the Global South to products from the North;
3) reduce or eliminate the ability of governments of indebted countries
to grant subsidies to agriculture and industry, which in turn prohibits
the products of these countries from competing in the both local and international
markets;
4) keep the populations of Latin American and Caribbean countries uneducated
and unhealthy which ensures a weakened, docile population and a labor
surplus;
5) ensure that the Northern countries and IFIs are able to continue receiving
debt payments on a regular basis;
6) are a mechanism of domination and oppression that increases dependency.
Statements of Understanding of IFIs
We believe that:
* The purpose of the IFIs is to represent the interests of the G7 Governments
(seven most industrialized countries), and transnational corporations.
* Debt relief programs are a product of IFIs overstepping their original
mandates.
* The IFIs are incapable of poverty reduction.
* The IFIs are obsolete.
* The IFIs are the major vehicle for promoting neoliberal economic policies.
* The IFIs promote corruption.
* The policies and programs of IFIs contribute to, and even cause, greater
poverty and exploitation in Latin America and the Caribbean.
* The IFIs do not have the political will to tackle the causes of poverty.
Statements of Understanding of Debt Relief Initiatives
We believe that:
* The deregulation, privatization and liberalization that are imposed
by debt relief programs trap the Caribbean and Latin America in a perpetual
cycle of debt dependence and underdevelopment.
* Debt relief initiatives serve the interests of the North and the IFIs
while creating destruction in the Caribbean and Latin America. These debt
relief initiatives include: Brady Bonds, debt buy-back schemes, the HIPC
(Heavily Indebted Poor Countries) initiative the ESAF (Enhanced Structural
Adjustment Facility) and the new PRGF (Poverty Reduction and Growth Facility)
and PRSPs (Poverty Reduction Strategy Papers).
* These initiatives provide creditor relief by recycling the uncollectable
loans of Latin American and Caribbean countries while perpetuating indebtedness
by ensuring that indebted countries are able to service their debts through
renewed access to international credit.
* The HIPC initiative divides countries in Latin America and the Caribbean
from one another by categorizing some as more heavily indebted than others
and as a result allowing only the most heavily indebted to enter into
the programs.
* Arbitrary divisions created by IFIs do not represent the reality of
poverty in indebted countries. All indebted countries have experienced
exploitation and the debts of each country have been paid.
* Debt relief is a tool of the IFIs to improve their deteriorated image.
* Debt relief is the trap that IFIs use to maintain their domination
and talk about policy and not politics.
Statements of Principle of Debt, its nature, effects and purpose:
We believe that:
* The debts owed to the North from Latin America and the Caribbean are
unjust, unethical and immoral because of their historical context.
* Due to the historical origins of indebtedness, the North is obligated
to make reparations to the countries in Latin America and the Caribbean.
* The debt of Latin America and the Caribbean is illegitimate.
* The terms of payment for debt are unfair and unjust.
* It is unethical for lending institutions and donor countries to require
structural adjustment programs because they substantially increase poverty.
* SAPs are flawed on a fundamental level because they prioritize a set
of economic principles above human life and the environment.
* The universal application of SAPs in Latin America and the Caribbean
is reckless and irresponsible endangerment of human life and the environment.
* Increased poverty in Latin America and the Caribbean cannot be tolerated.
* It is unjust for IFIs to impose programs that weaken the ability of
Latin American and Caribbean countries to participate as equals in the
global market.
* It is unfair to place sole responsibility for increasing international
crime on countries in Latin America and the Caribbean considering that
these crimes are a product of an unjust economic system.
* It is immoral to create a global economic system with a primary function
of maintaining the subordination of the Global South to the Global North.
* IFIs should not be involved in poverty reduction.
* Any program that purports to alleviate poverty without actually doing
so is fraudulent.
* It is unacceptable for IFIs to use debt relief strategies to divide
and demobilize the Global South, as they have with the HIPC Initiative.
NOTE: In our workshop we divided into four groups to create the following
Statements of Derived Positions and Actions.
Statements of Derived Positions on Debt
Therefore:
* The North owes the South. The South does not owe the North; what are
called its debts are illegitimate claims.
* The South has the right to have its debt canceled.
* The South has a right to reparations.
* There must be actions to prevent the build-up of future debt.
Actions on Debt
Therefore:
* We need to have an increase in popular and other forms of education
which integrates campaigns. (Example: Fair trade coffee)
* Form brigades on which investigate the ecological debt owed by the
North to the South for exploitation, etc., as well as ones which focus
on all the effects of illegitimate debts.
* Use the arts to encourage cultural interchanges to illustrate the impact
of debt and corporate globalization.
* Speaking tours featuring speakers from Southern countries.
* Interchanges within countries.
* Mobilizations of people (with other already formed campaigns).
* Process of raising the consciousness of new generations.
Statements of Derived Positions on Globalization and Racism, Classism
and Sexism
Therefore:
* The global economy is based on racism, classism and sexism.
Actions on Racism, Classism and Sexism
Therefore:
* Put a human and local face on the impacts of corporate globalization.
* Connect real stories in people’s native language.
* Identify the adverse effects of corporate globalization in the U.S.
* Do large-scale education in grade school and high school, but start
with small-scale where necessary.
* Activist teach-ins that will lay out the neo-liberal economic model.
* Create a curriculum for reform of the economic institutions and neo-liberal
model.
* Incorporate language of inherent racism in our critique.
* Question our own privilege and racism.
* In our analysis of race and ethnicity we must acknowledge that within
each group, --Asian, Caucasian etc.-- there are other groups.
Statements of Derived Positions on Privatization and Dollarization
Therefore:
* We support the campaigns of Southern partnership on all issues surrounding
debt including the issue of privatization.
* We oppose privatization and dollarization of services at the expense
of workers or to the detriment of society.
Actions on Privatization and Dollarization
Therefore:
* Educate through popular education and media on these topics.
* Globalize the social movement by using country-specific examples.
* 3 Day Action Against Poverty (August 3-5, see Kensington Welfare Rights
Union for details.)
* May Day demonstrations.
* Produce information on these issues.
Statements of Derived Positions on the International Financial Institutions
Therefore:
* We support the Drop the Debt campaign to require the IFIs to cancel
100% of the debt out of their own resources.
* We support pressure on the World Bank to stop lending and only provide
grants to Southern countries without Structural Adjustment Programs.
* We support shifting all IFIs away from macro-economic conditions.
* We support phasing out the IMF.
* The IFIs are culpable and illegitimate.
Actions on the International Financial Institutions
Therefore:
* Create a truth commission.
* Education on illegitimacy and corruption issues.
* Support and join the Jubilee USA Network.
* Go to the D.C. mobilization at the end of September around the fall
meetings of the IMF and World Bank.
* Grassroots mobilization.
* Work with Jubilee South.
* Create a working group to develop alternate strategies on development
and a new economic model.
* Campaign for living wage and community determination.
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