Committee for the Abolition of Illegitimate Debt

What are the main objectives of CADTM?

As stated in our founding documents, CADTM is committed to promoting the emergence of a more just world with respect for the sovereignty of peoples, social justice, and equality between men and women. Our main work, focused on the problem of debt, is the realization of actions and the development of radical alternatives aiming at the emergence of a world based on sovereignty, solidarity and cooperation between peoples, respect for nature, equality, social justice and peace. This is an attempt to stop the downward spiral of unsustainable debt in the South and the North and to achieve the establishment of socially just and environmentally sustainable development models.

Debt is part of a system that must be fought as a whole but for CADTM, the cancellation of illegitimate debt is not an end in itself. This is a necessary, but not sufficient condition, to ensure that needs and human rights are respected. We must necessarily go beyond this and implement other radical alternatives which free humanity from all forms of oppression: social, patriarchal, neo-colonial, racial, caste, political, cultural, sexual and religious.

Can you explain to our readers the term “illegitimate debt”?

Illegitimate debt is not a technical or legal, but a political concept. An illegitimate debt is a debt that goes against the interests of the population, who is therefore not required to repay it. The Greek Debt Truth Commission established by the President of the Hellenic Parliament Zoe Konstantopoulou to identify the parts of the Greek public debt which are odious, illegal, illegitimate and unsustainable, defines the concept:

• “Illegitimate debt is a debt that the debtor can not be required to repay due to the fact that the loan, financial securities Financial securities Financial securities include equity securities issued by companies in the form of shares (shares, holdings, investment certificates, etc.), debt securities, excluding commercial instruments and savings certificates (bonds and similar securities), and holdings or shares in Undertakings for Collective Investment in Transferable Securities (UCITS). , warranty or terms and conditions attached to the loan are contrary to law (both national and international) or the general interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. ; or because these terms are clearly unjust, excessive, abusive or objectionable in any way; or because the conditions attached to the loan, to the warranty, contain policy measures that violate national law or standards of human rights; or in the end because the loan or the guarantee is not used to benefit people or the debt is the product of a conversion of private (or commercial) debt to public debt under pressure from creditors.”

It is important to remember that this definition is based on the general principles of international law. It is this concept that draws many social movements to demand the non-payment of any debt considered illegitimate, and it represents a very large part of the public debt of our states in whose name the authorities apply antisocial austerity policies.

What are the key aspects of oppression at the collective level?

We live in a world of wars for grabbing natural resources and land, where profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. is pursued by the few at the expense of all others. This world generates growing inequalities and exclusions, wars and famines. It is based on the systematic exploitation of our labour force, manipulation of thought through our educational system and media and physical repression of dissent. This oppression is surreptitiously interfering in our daily life to become the norm, until the real war in Algeria no longer appears in French history textbooks or a so-called “bailout” for one State is one that actually consists in saving private banks. The citizens become mere consumers will be made feel guilty to reduce their energy costs with low energy light bulbs, while energy-intensive video screens are installed in the subway to flood us with advertising. In a world where we are pushed towards the over-consumption of over-packaged goods, we are encouraged to recycle our garbage while industrialized countries export their toxic waste to poor countries and they continue to promote the nuclear weapons and chemicals that may well turn the world into a massive wasteland.

How can people emancipate themselves, and how can we fight against oppression of all kinds?

I do not believe in miracle recipes because it depends on the social and political context and ultimately the balance Balance End of year statement of a company’s assets (what the company possesses) and liabilities (what it owes). In other words, the assets provide information about how the funds collected by the company have been used; and the liabilities, about the origins of those funds. of power, but solidarity between peoples and self-emancipatory action are two essential factors. But in the capitalist world in which we live, private interests are exacerbated for greater competitiveness between companies and people. You have to understand capitalism as a destructive and deadly system, at the antipodes of life, a system that dehumanizes and privatize everything. From the water that quenches our thirst to our future retirement, everything becomes merchandise. It is therefore essential to humanize our everyday relationships, to socialize knowledge and reinforce experiences and expressions of resistance that multiply away from the big media debates. We must ourselves be the media if we want to relate the many victories of local struggles that are not relayed and are even stifled by large private media groups These pieces of good news (see for example the website Bonnes nouvelles in French), as small as they are, show us every day that alternatives are possible, they work towards the demolition of the capitalist dogma that there are no alternatives, the famous TINA (Margaret Thatcher’s “There is no alternative”) must die. This vital and subversive information can encourage and gather us to broaden the circles resistant to the oppressive capitalist order. Of course this is not obvious, but as Antonio Gramsci said, “We must combine the pessimism of reason with the optimism of the will.” We must recover continually diverted words so as to adapt to the system we are fighting, to speak, to create, to resist together, to finally live in the present. Empowering people through their class consciousness, their unification as a “people-class”, of the 99% against the 1% who exploit them, but awareness can not take place without free speech in action.

Tell us about the CADTM network

In 1989, the “call of the Bastille” launched in Paris affirmed that “only the solidarity of people can break the power of economic imperialism” and invited all popular forces of the world to unite for the immediate and unconditional cancellation of the debt of so-called “developing” countries. In response to this appeal, the Committee for the Abolition of Third World Debt (CADTM) was founded in Belgium on the 15^th of March 1990. CADTM International is now a network of around thirty organisations in over 25 countries on 4 continents. Every three years to coordinate its international and continental work, CADTM holds its World Assembly. The next meeting will be held in Tunis from 26^th to 30^th April 2016. RAID ATTAC Tunisia, a member of the network, offered to host the World Assembly of CADTM in their country since the Moroccan authorities have refused to give their approval to organize this international activity in Morocco as was originally planned. [1] By refusing to acknowledge reception of files disposed at prefectures of the cities of Ait Melloul and Bouznika, Morocco sinks into the undemocratic way. This prohibition worthy of a totalitarian regime is in addition to continuing restrictions plaguing the ATTAC CADTM Morocco association and the refusal to renew it’s legal receipt in order to operate in accordance with the law.

The World Assembly of the network is an important moment of the committee where we collectively decide on the new memberships of organizations that have requested it. We will without doubt propose a name change for the organization as the “Third World” is no longer the preserve of a distant South, it is now spreading across the globe starting with Greece and Ukraine in Europe. Also we are developing intensive work in the North and are for example particularly attentive to the emergence of new social movements that want to audit the debt to repudiate payment like in Spain and we are continuing our work of auditing Greek debt. There is no such thing as the developed world and the underdeveloped world but only one badly developed world, the CETIM reminds us. [2]

The strengthening of social movements is a priority for CADTM. It participates, in an internationalist perspective, in the building of a broad popular movement that is conscious, critical and mobilized. Convinced of the need to unite struggles for emancipation, CADTM International supports all organizations and coalitions which work towards equality, social justice, preservation of nature and peace.

And what about the debt of the USA, which is the biggest in the world, with more than 18,000 billion dollars?

The US debt was increased to save the banks with a supposed “rescue” plan of more than 3,300 billion uncollected dollars between 2008 and 2013 and these same banks have evicted more than 14 million families from their homes since 2005. That said, there are fundamental differences with the debt of other countries. If the US is the most indebted in the world, at the amount of more than 19,000 billion at the beginning of March, 2016 (or 103% of GDP GDP
Gross Domestic Product Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another. ), the stakes are not the same as for other countries impoverished by the “debt system” for several reasons.

Let us have a brief flashback. At the end of the Second World War, the USA established themselves as the largest creditor of the world. As the principal world economic power of the capitalist system, they control the major international financial institutions which indebt the entire planet like the IMF IMF
International Monetary Fund Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org and the World Bank World Bank
WB The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

, sitting in Washington where the US enjoy a veto. In addition, the US does not need large foreign reserves as the world accepts the dollar as the international currency of payment, another fundamental privilege.

Furthermore, the titles of the public debt of some developed countries such as US Treasury bonds are assets considered as less risky, and easily find takers. This is the case of China, which holds $1,240 billion, and Japan. What is less well known, is that this is also the case in many African countries and Russia has increased its investment in 2015 and happens to be the 15^th holder of US debt to the tune of $92 billion. If the US manage to hold this level of debt that exceeds 19,000 billion dollars, that is to say, nearly 10 times the overall total public external debt of developing countries (1,800 billion dollars), it is because the rest of the world lends them money. So as the Treasury bills have a good rating from the private rating agencies Rating agency
Rating agencies Rating agencies, or credit-rating agencies, evaluate creditworthiness. This includes the creditworthiness of corporations, nonprofit organizations and governments, as well as ‘securitized assets’ – which are assets that are bundled together and sold, to investors, as security. Rating agencies assign a letter grade to each bond, which represents an opinion as to the likelihood that the organization will be able to repay both the principal and interest as they become due. Ratings are made on a descending scale: AAA is the highest, then AA, A, BBB, BB, B, etc. A rating of BB or below is considered a ‘junk bond’ because it is likely to default. Many factors go into the assignment of ratings, including the profitability of the organization and its total indebtedness. The three largest credit rating agencies are Moody’s, Standard & Poor’s and Fitch Ratings (FT).

Moody’s : https://www.fitchratings.com/ (Fitch Ratings, Standard & Poor’s and Moody’s [3]) controlled by them, the US can continue to borrow cheaply and thus finance their deficit.

Moreover, the US has the ability to borrow from the Federal Reserve FED
Federal Reserve Officially, Federal Reserve System, is the United States’ central bank created in 1913 by the ’Federal Reserve Act’, also called the ’Owen-Glass Act’, after a series of banking crises, particularly the ’Bank Panic’ of 1907.

FED – decentralized central bank : http://www.federalreserve.gov/ (FED, equivalent of a central bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

ECB : http://www.bankofengland.co.uk/Pages/home.aspx ). Thus, of the total public debt (19,000 billion), 5,300 million represents the national debt of the government to the FED. Remember that this option is banned within the European Union where Member States are not allowed to borrow from their national central banks or the European Central Bank ECB
European Central Bank The European Central Bank is a European institution based in Frankfurt, founded in 1998, to which the countries of the Eurozone have transferred their monetary powers. Its official role is to ensure price stability by combating inflation within that Zone. Its three decision-making organs (the Executive Board, the Governing Council and the General Council) are composed of governors of the central banks of the member states and/or recognized specialists. According to its statutes, it is politically ‘independent’ but it is directly influenced by the world of finance.

https://www.ecb.europa.eu/ecb/html/index.en.html and have no other solution than to borrow at high rates with private banks, which themselves receive very cheap money from ECB. A lucrative business for banks...

Finally, one can not ignore private student debt based on an unaffordable private education system. Student debt in the US now represents more than 1,200 billion dollars. This figure is well above the total of the accumulated public external debt of Latin America and Africa. At the end of their studies, many unemployed students are trapped in suffocating debt, $35,000 on average in 2015. A debt that they are struggling to pay sometimes even up to the age of retirement. The Strike Debt citizen collective federates the indebted students and supports them in their fight against the banks.