Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers

Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers

by Eric Toussaint, Damien Millet, Vicki (T Briault
     
 

Mainstream economists tell us that developing countries will replicate the economic achievements of the rich countries if they implement the correct “free-market”policies. But scholars and activists Toussaint and Millet demonstrate that this is patently false. Drawing on a wealth of detailed evidence, they explain how developed economies have

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Overview

Mainstream economists tell us that developing countries will replicate the economic achievements of the rich countries if they implement the correct “free-market”policies. But scholars and activists Toussaint and Millet demonstrate that this is patently false. Drawing on a wealth of detailed evidence, they explain how developed economies have systematically and deliberately exploited the less-developed economies by forcing them into unequal trade and political relationships. Integral to this arrangement are the international economic institutions ostensibly created to safeguard the stability of the global economy—the International Monetary Fund (IMF) and the World Bank—and the imposition of massive foreign debt on poor countries. The authors explain in simple language, and ample use of graphics, the multiple contours of this exploitative system, its history, and how it continues to function in the present day.

Ultimately, Toussaint and Millet advocate cancellation of all foreign debt for developing countries and provide arguments from a number of perspectives—legal, economic, moral. Presented in an accessible and easily-referenced question and answer format, Debt, the IMF, and the World Bank is an essential tool for the global justice movement.

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Product Details

ISBN-13:
9781583672235
Publisher:
Monthly Review Press
Publication date:
09/01/2010
Pages:
304
Product dimensions:
5.60(w) x 8.30(h) x 1.10(d)

Related Subjects

Meet the Author

éric Toussaint, a doctor in political science, is president of the Committee for the Abolition of Third World Debt, CADTM Belgium. He is author of A Diagnosis of Emerging Global Crisis and Alternatives and The World Bank: A Critical Primer, among other books.

Damien Millet teaches mathematics and is spokespersonfor CADTM France. He is the author of L’Afrique sans dette and co-author with Eric Toussaint of Tsunami Aid or Debt Cancellation.

Table of Contents

Abbreviations 10

Introduction 11

1 HUMAN RIGHTS, DEVELOPMENT, AND DEBT 13

1 What is meant by "developing countries"? 15

2 Why is the term "development" ambiguous? 19

3 What is the link between debt and poverty? 22

4 What are the "Millennium Development Goals" (MDG)? 27

5 What are the different kinds of debt for developing countries? 44

2 THE ORIGIN OF THE DEBT IN DEVELOPING COUNTRIES 47

6 What part did private banks play in the development of developing countries' external debts in the 1960s & 1970s? 49

7 What part did the World Bank play in the development of the developing countries' external debts in the 1960s and 1970s? 51

8 How does the World Bank function? 54

9 What part did the governments of countries of the North play in the evolution of the developing countries' external debt in the 1960s and 1970s? 61

10 How was the borrowed money used in the developing countries? 63

3 THE DEBT CRISIS 71

11 How did the price of commodities evolve during the last quarter of the twentieth century? 73

12 What role did the evolution of interest rates play in the 1982 debt crisis? 75

13 Are the World Bank, the IMF, and private banks somehow responsible for the debt crisis? 79

14 How did creditors respond to the debt crisis? 82

15 Are there any similarities with the 2007 subprime crisis? 88

4 THE IMF, THE WORLD BANK, AND THE LOGIC OF STRUCTURAL ADJUSTMENT 93

16 How does the IMF function? 95

17 What are the short-term or shock measures imposed by structural adjustment, and what are their consequences? 106

18 What are the long-term or structural measures imposed by structural adjustment, and what are their consequences? 109

19 What is the impact of the IMF/World Bank logic on the world food crisis of 2007? 119

5 OTHER INTERNATIONAL PLAYERS: THE PARIS CLUB AND THE WTO 125

20 What is the Paris Club? 127

21 Are all the developing countries treated in the same way by the Paris Club? 131

22 What is undermining the Paris Club? 135

23 What is the role of the World Trade Organization (WTO)? 138

6 THE STRUCTURE OF DEVELOPING COUNTRIES' DEBT 143

24 Of what does the external debt of developing countries consist? 145

25 How has the debt changed since 1970? 150

26 Do developing countries repay debts? 152

27 What about the external public debt of developing countries? 155

28 How are the debt-related financial flows directed? 161

29 What about the domestic debt of developing countries? 164

7 DECIPHERING THE OFFICIAL DISCOURSE ON DEBT RELIEF 171

30 How did the debt relief initiative come about? 173

31 What is the Heavily Indebted Poor Countries (HIPC) initiative? 175

32 Has the HIPC initiative achieved its goal? 178

33 What was contained in the latest debt relief announced by the G8 in 2005? 188

8 THE SHAM OF THE DOMINANT MODEL 195

34 Does Official Development Assistance (ODA) help to mitigate the effects of the debt? 197

35 Is micro-credit a solution to the excessive debt of developing countries? 204

36 Have the policies promoted by the World Bank and the IMF contributed to the fight against climate change? 206

37 What is NEPAD? 211

9 DEBT CANCELLATIONS AND SUSPENSIONS OF PAYMENT IN THE PAST 215

38 Is it impossible to cancel debt? 217

39 Why do the governments of the South continue to repay the debt? 228

40 What are vulture funds? 230

10 THE CASE FOR CANCELING THE DEBT OF DEVELOPING COUNTRIES 237

41 What are the moral arguments in favor of canceling the debt of developing countries? 239

42 What are the political arguments in favor of canceling the debt of developing countries? 241

43 What are the economic arguments in favor of canceling the debt of developing countries? 244

44 What are the legal arguments in favor of canceling the debt of developing countries? 246

45 What are the environmental arguments in favor of canceling the debt of developing countries? 254

46 What are the religious arguments in favor of canceling the debt of developing countries? 257

47 Who owes what to whom? 261

48 Who has the right to impose conditions on debt cancellation? 262

49 Can the development of emerging countries be ensured simply by repudiating their debt? 264

11 ISSUES RAISED BY CANCELING THE DEBT OF THE DEVELOPING COUNTRIES 267

50 Would canceling the debt of developing countries cause of global financial crisis? 269

51 If developing countries' debts were canceled, would the citizens of the North end up paying the bill? 273

52 Will canceling the debt help reinforce existing dictatorial regimes? 276

53 Should borrowing be avoided at all cost? 281

12 CONSTRUCTING RADICAL ALTERNATIVES 285

54 What are the alternatives for human development in the developing countries? 287

55 If and when the debt is canceled, how can a new round of indebtedness be avoided? 302

56 What is debt auditing? 304

57 Are China, sovereign funds, or the Bank of the South valid alternatives? 307

58 Can the developing countries' external public debt be compared to the public debt of the North? 315

13 INTERNATIONAL CAMPAIGN FOR DEBT CANCELLATION 319

59 How did the international campaign for debt cancellation start? 321

60 What is CADTM and how was it born? 324

Appendix 1 The 145 Developing Countries in 2008 329

Appendix 2 Glossary 333

Notes 347

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