Committee for the Abolition of Illegitimate Debt

The author works with the 50 Years Is Enough campaign/network — the national coalition of organizations opposed to 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 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.

. His articles have appeared in the Washington Post, Z Magazine, Toward Freedom and elsewhere, and he edits a quarterly newsletter, “Economic Justice News” (see www.50years.org).

The internet is again buzzing with talk of protest. The targets are many in 2004: the Democratic convention in Boston in July; the Republican convention in New York City in September; the Group of 8 industrialized countries meeting off the coast of Georgia in June.

Before those, however, there’s an old favorite to take care Care Le concept de « care work » (travail de soin) fait référence à un ensemble de pratiques matérielles et psychologiques destinées à apporter une réponse concrète aux besoins des autres et d’une communauté (dont des écosystèmes). On préfère le concept de care à celui de travail « domestique » ou de « reproduction » car il intègre les dimensions émotionnelles et psychologiques (charge mentale, affection, soutien), et il ne se limite pas aux aspects « privés » et gratuit en englobant également les activités rémunérées nécessaires à la reproduction de la vie humaine. of: the joint meetings of the architects and enforcers of corporate globalization, the International Monetary Fund (IMF) and the World Bank. They will be convening in Washington on April 24, and thousands of demonstrators are planning to be there as well. The serendipitous timing of the March for Women’s Lives on April 25 - scheduled before the institutions set their meetings - means that many thousands more potential allies, well-acquainted with the disproportionate burdens forced on women by corporate globalization, will be in Washington at the same time.

At the World Social Forum in Mumbai, India in January, the IMF and World Bank were popular candidates for global justice groups’ discussions and agendas. People from across Asia, Africa, Latin America, and the Pacific and Caribbean islands - the regions where the IMF and World Bank impose their economic austerity policies in exchange for loans to indebted governments - endorsed a call to action that included the April mobilization in Washington, international days of action in both April and September, and four core demands. Those demands, familiar to many global justice campaigners, include (1) cancellation of impoverished country debt claimed by the IMF and World Bank; (2) an end to the imposition of economic austerity and deregulation (“structural adjustment Structural Adjustment Economic policies imposed by the IMF in exchange of new loans or the rescheduling of old loans.

Structural Adjustments policies were enforced in the early 1980 to qualify countries for new loans or for debt rescheduling by the IMF and the World Bank. The requested kind of adjustment aims at ensuring that the country can again service its external debt. Structural adjustment usually combines the following elements : devaluation of the national currency (in order to bring down the prices of exported goods and attract strong currencies), rise in interest rates (in order to attract international capital), reduction of public expenditure (’streamlining’ of public services staff, reduction of budgets devoted to education and the health sector, etc.), massive privatisations, reduction of public subsidies to some companies or products, freezing of salaries (to avoid inflation as a consequence of deflation). These SAPs have not only substantially contributed to higher and higher levels of indebtedness in the affected countries ; they have simultaneously led to higher prices (because of a high VAT rate and of the free market prices) and to a dramatic fall in the income of local populations (as a consequence of rising unemployment and of the dismantling of public services, among other factors).

IMF : http://www.worldbank.org/ ”) programs; (3) an end to financing for environmentally- and socially- destructive projects; and (4) an opening of the hyper-secretive institutions’ board meetings to public observation. (Additional endorsements are welcome at .)

The meetings, and the opposition activities that will accompany them, come roughly five months after the last big globalization summit in the U.S., the meeting of trade ministers from the western hemisphere (excluding Cuba) in Miami in November to negotiate the Free Trade Area of the Americas (FTAA). The police repression that dominated headlines out of Miami should not obscure the fact that the meeting was the site of a substantial defeat for the Bush Administration’s corporate globalization agenda. Put on notice by the collapse of the World Trade Organization meeting in September in Cancún, the U.S. in Miami gave up on its dream of an FTAA in which every country would be obligated to uniformly open markets to U.S. goods and adopt pro-corporate legal codes on patents and investments. Instead it accepted a compromise “cafeteria” plan that would allow each country to declare what provisions it would “opt in” for - a plan that drew immediate fire from its usual friends in the corporate lobby Lobby
Lobbies A lobby is an entity organized to represent and defend the interests of a specific group by exerting pressure or influence on persons or institutions that hold power. Lobbying consists in conducting actions aimed at influencing, directly or indirectly, the drafting, application or interpretation of legislative measures, standards, regulations and more generally any intervention or decision by the Public Authorities. .

The WTO WTO
World Trade Organisation The WTO, founded on 1^st January 1995, replaced the General Agreement on Trade and Tariffs (GATT). The main innovation is that the WTO enjoys the status of an international organization. Its role is to ensure that no member States adopt any kind of protectionism whatsoever, in order to accelerate the liberalization global trading and to facilitate the strategies of the multinationals. It has an international court (the Dispute Settlement Body) which judges any alleged violations of its founding text drawn up in Marrakesh.

Cancún collapse, however, fuelled an atmosphere of optimism that pervaded Mumbai. The refusal of developing countries there to accept the U.S./E.U. agenda - Africans demanding the U.S. end its cotton subsidies that have crippled African growers; about 70 states that refused to go along with the European agenda for expanding the scope of the WTO; a high-profile group of countries led by Brazil and India which demanded more access to U.S. and European markets - has buoyed the global justice movement, which at last sees governments refusing to submit to oppressive agreements just because the powerful countries declare them the only game in town. Calls to bring the spirit of Cancún to the IMF and World Bank resonated in Mumbai. The Washington-based institutions, where the rich countries control all the levers of power and no space is provided for democratic debate, remain tougher nuts to crack, however.

The urgency is unmistakable, however. Even in an era of unilateralism, the Bush Administration is content to let the multilateral institutions (at which the U.S. can exercise nearly unlimited influence when it wants to) continue to do the dirty work of restructuring and monitoring the economic programs of most developing countries.

IMF/World Bank programs have resulted in devastated healthcare systems in Africa, making it more susceptible to the scourge of HIV/AIDS. When the World Bank claims to be the largest funder of AIDS programs, its claims should be put in the context of the devastation it wrought in years past - and with a recognition that the loans they make to countries, like those in the Caribbean, that do not qualify for grants for HIV/AIDS programs, add to their client countries’ mountainous debt burdens.

The institutions have long insisted on trade liberalization and export-dependency - the cornerstones of corporate globalization. Since most of their clients grow the same cash crops - coffee, tea, cotton, flowers, cocoa - and because the law of supply and demand has not been repealed, many in the Global South have wondered if the historic bottoming out of world commodity prices is really an unfortunate accident or a calculated gift for the multinational corporations positioned to benefit from the permanent buyers’ market. World Bank officials’ protests in the last couple years about the North’s rigging of the global trading Market activities
trading Buying and selling of financial instruments such as shares, futures, derivatives, options, and warrants conducted in the hope of making a short-term profit. system seem particularly disingenuous after 20 years of re-structuring global markets - are we really to believe the Bank is only now noticing that the policies it has imposed don’t work in the face of Northern dumping, subsidies, and closed-off markets?

Undaunted, the World Bank’s latest idea for the world’s poorest countries is requiring that they turn over delivery of the most basic public services, particularly water provision, to private providers, a move that has already caused price spikes in several countries, and revolts in others.

The damage caused by the IMF and World Bank first attracted broad public attention in the U.S. ten years ago, on the 50^th anniversary of the founding of the IMF and World Bank. The “50 Years Is Enough” campaign focused on the debt crises, the structural adjustment fiascos, the lack of transparency at the institutions, and the destructive dam, oil, and other infrastructure programs of the World Bank. It helped set in motion a focus on corporate globalization that led to the Seattle demonstrations against the World Trade Organization in 1999, and a few months later brought 25,000 opponents of the IMF and World Bank to Washington.

Now, ten years later, the IMF and World Bank face their 60^th anniversary having changed disappointingly little.

Some improvements have been made in transparency and provision of information - their websites are full of data, and the IMF now says it will release reports on their meetings after 5 years (as opposed to 30 years). But most of the information is in English, and very little of it gets translated into the languages spoken by the people most likely to be affected by a dam, power plant, or road-building project.

Pushed by the Jubilee campaigns which reached an international peak in 2000, the IMF and World Bank introduced their own debt management scheme, which has failed to provide the promised levels of relief, leaving many countries in officially “unsustainable” debt situations even after graduation. Suspicions among campaigners that the program was a sophisticated system of bribery to keep countries considering default from opting out of the debt treadmill have been confirmed by World Bank reports that the program never had a prayer of doing what it promised.

The institutions have responded to the universal disrepute of “structural adjustment” by changing its name. Fifteen years after 1984, they did the adjective “Orwellian” (and the noun “chutzpah”) proud by announcing the programs would henceforth be known as “poverty reduction and growth.” By requiring that governments involve civil society organizations in the drafting of their own structural adjustment programs, the institutions attempted to respond to the charge that they did not solicit the participation of affected peoples. The participatory processes have largely been shams, however, and in none of them have people been allowed to argue against the trade and investment liberalization, 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. rate hikes, privatization, and other policies that are the core of structural adjustment. The initiative is now widely considered a public relations stunt and a clumsy attempt to co-opt civil society into appearing to sign its own death warrant.

Most recently, the resignation of the head of the IMF, Horst Koehler, to accept nomination as President of Germany, has exposed the IMF to renewed criticism from many of its usual supporters in mainstream op-ed pages. That’s because all signs suggest the IMF, which demands transparency of its client countries, will again choose its Managing Director through a closed-door process which by custom restricts nominees to Western Europeans. This gross hypocrisy, which is mirrored by the U.S. fiefdom at the World Bank, frustrates the institutions’ defenders, precisely because it so clearly exposes their identity as agents of the big economic powers.

In a presidential election year, the IMF/World Bank meetings may seem like a sideshow. But with international trade already playing a prominent role in the Democratic primaries, and with the power and damage done by the institutions growing daily, global justice activists are hoping that increased attention to the U.S. role in the world will cause voters, and candidates, to conclude that the institutions’ 60^th birthday is a good time to start planning for their retirement.