CADTM raises awareness on the Debt at the US Social Forum

6 July 2010 by Daniel Munevar


Last week took place in Detroit, Michigan, the second US Social Forum. According to the organizers more than 14000 people from all over the United States and more than 60 countries registered to play a part at the main gathering of the social movements in the country. The participants had the opportunity to engage in discussions and elaborate on strategies to tackle the current social, environmental and economic crisis in the thousand workshops and seminars that took place during 4 intense days.

As part of the commitment of the CADTM to strengthen the international social movement, the organization was itself present and active at the USSF with a delegation composed by Myriam Bourgy (CADTM Belgium), Daniel Munevar (CADTM Belgium) and Bushra Khaliq (CADTM Pakistan). Through the realization of 2 workshops, the CADTM continued to build on its efforts to raise awareness on the central role of debt to the current social struggles for the people on the North and the South.

The first workshop concentrated on the discussion of the current situation of debt in Latin America and the lessons that could be learned from the recent experiences in Argentina, Ecuador and Brazil in terms of debt management and debt auditing. On the other hand, the second workshop focused on the issue of debt in the north. The group of speakers was composed by David Finkel (Against the Current - USA), Bushra Khaliq (CADTM Pakistan), and Daniel Munevar (CADTM Belgium).

There were common themes running through the discussions in both workshops. First, it was the increasing attention that the issue of debt is receiving on the countries of the north from the part of the general public. The fact that day after day the media has made the discussion about fiscal deficits and debt a common place, this elevated the profile of the issue of debt in the public discourse. Second, the importance and relevance of the lessons learned from the South related to 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, for the current situation of the North. After decades of facing problems of financial instability, reverse flows, debt crisis and austerity programs, the South social movements posses a large degree of expertise from which movements from the North can and must draw upon in order to avoid the same dire social and political consequences. And last but not least, the third common theme was the 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. attracted by the different initiatives that are taking root in Latin America, such as the Bank of the South and the organization of debt audits in Ecuador and Brazil. This clearly demonstrates that the ability to make progress on the struggle against the debt system heavily relies on the construction of real alternatives to the current international financial system.

Nevertheless the presence and activism of the CADTM went beyond the discussions and joined forces with the people of Detroit protesting on the streets against the foreclosure policy of Chase Manhattan Bank in the state of Michigan. With a large and festive crowd that included a small music band, the participants of the protest marched through downtown Detroit and proceeded to surround the regional offices of Chase. On the face of the large gathering of people taking place at the footsteps of the bank, the managers accepted to receive a delegation of the manifestation with a pledge of claims. After a couple of hours, the management of the bank agreed to organize a meeting between those affected by the foreclosures and a representative of the direction of Chase Manhattan. Even though the meeting is no guarantee that the harmful practices of the bank, which specially affect low-income households, will come to an end, by itself it’s a demonstration that financial institutions are not immune to a well-organized action by the social movement.

Finally, aware of the importance of building alliances to abolish the system of domination of the debt, the CADTM organized meetings and discussions with several organizations that were also present at the forum. These included the World March of Women, Jubilee US and Jubilee South. All of the meetings ended on a positive note with commitments to the organization of common actions during the following action. In the end, as participants in Detroit made clear, not only another World is Possible, but it is in fact already happening.




Daniel Munevar

is a post-Keynesian economist from Bogotá, Colombia. From March to July 2015, he worked as an assistant to former Greek Finance Minister Yanis Varoufakis, advising him on fiscal policy and debt sustainability.
Previously, he was an advisor to the Colombian Ministry of Finance. He has also worked at UNCTAD.
He is one of the leading figures in the study of public debt at the international level. He is a researcher at Eurodad.

Translation(s)

CADTM

COMMITTEE FOR THE ABOLITION OF ILLEGITIMATE DEBT

8 rue Jonfosse
4000 - Liège- Belgique

00324 60 97 96 80
info@cadtm.org

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