Committee for the Abolition of Illegitimate Debt

CADTM developed its profile completely as an organization working on South-North debt relations since the early 1990s. However, its narrative in 2007 differed (along with its organization, action repertoire, and general framing practices). In its political charter written a year before the crisis moved from the lived reality of poor US homeowners into public consciousness, CADTM noted “two major opposing trends” to have emerged on a global scale since its foundation in 1990: a deepened “neo-liberal capitalist offensive, whose principal proponents are the G7, 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 , 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.

] and 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.

, all of whom cater to the interests of multinationals and international financial capital”; but also a powerful
counter-movement to this trend. [2]

The North Atlantic Financial Crisis then tremendously changed CADTM’s structure, perspective, and eventually even its name. CADTM’s spokesperson Eric Toussaint remembers in a recent historicization of CADTM’s trajectory:

Yes, the Northern debt was not treated as a key issue in 1990, but I considered it to be so. As for the current situation, when the banking crisis which erupted in the US in 2006-2007 engulfed Europe towards 2007-2008, and when a number of countries socialized their banking losses to save the banks, the public debt rocketed. I was immediately convinced, with other members of the CADTM, that it was time to take into account the new dimension of the Northern public debt. We did so before it dawned upon others. We must remember that in 2008-2009, the first reaction of José Manuel Barroso, President of the European Commission, was to propose a policy which looked like a neo-Keynesian turning-point. In fact, it simply provided temporary social shock absorbers because the Northern governments dreaded that the challenge to the system might turn into something colossal and dynamic. (Toussaint & Lemoine)

Indeed, briefly after the banking collapse of September 2008, Toussaint argued that the current was a deep crisis and that the socialization of private banking losses would entail wide-spread grievances (Toussaint 2008 [3]). Concretely, he criticized that the bailout policy equaled transferring the bill of “capitalists’ misbehaviour” to most of the population, who will face “less public services, fewer jobs, further decrease in purchasing power, higher contribution of patients to the cost of health care, of parents to the cost of their children’s education, less public investment … and a rise of indirect taxes.” Additionally, he stated that “[w]ith the deepening crisis a deep sense of unease will develop into political distrust of governments that carried out such operations” (Toussaint 2008).

CADTM’s analyses embedded the crisis into its previously developed body of knowledge, which stressed the interconnection of different forms of crisis, the link between Southern and Northern debt, and “the necessity to construct local and global alternatives

As a consequence of the crisis and its perception, work and analyses related to the crisis constituted one of the main pillars of CADTM’s activities in 2008 and 2009 (CADTM 2008a; 2009). In particular, the crisis impacted both CADTM’s public education activities as well as its production of analyses (CADTM 2008a). CADTM organized a three-day workshop called “Week-end Résistance 2008: L’Agriculture en résistance” (CADTM 2008b), a popular tribunal against the G8 G8 Group composed of the most powerful countries of the planet: Canada, France, Germany, Italy, Japan, the UK and the USA, with Russia a full member since June 2002. Their heads of state meet annually, usually in June or July. (CADTM 2008c), and co-hosted a series of six seminars under the title “finance and the citizen.” Additionally, the network held popular assemblies, a “camp des alternatives,” as well as a conference on local alternatives, and produced texts and videos about the crisis (CADTM 2008a; 2009; Millet & Toussaint 2010 [4]).

CADTM’s analyses embedded the crisis into its previously developed body of knowledge, which stressed the interconnection of different forms of crisis, the link between Southern and Northern debt, and “the necessity to construct local and global alternatives” (CADTM 2009, 8). They also stressed that “more and more the Southern populations are not the only ones to suffer the consequences of the failure of this system” and that Northern debt crises will entail austerity plans (CADTM 2009, 8). In its 2008 annual report, it distinguished several interconnected crises: financial, economic, food, climate-ecological, migration, and governance crisis (CADTM 2008a, 43 ff). The report identified … …

a structural need of capitalism to destroy excessive financial capital, which produced interrelated financial and economic crises;

a new food crisis stemming from export-driven reorganization of Southern agricultural sectors and the US-led financialization of agriculture;

a chronic ecological crisis related to centuries of Northern industrialization;

a degradation of Southern living conditions entailed by all these processes and subsequent migration flows towards the North, where remittances are now weakened due to unemployment and austerity;

a crisis of governance empowering undemocratic institutions such as G8 and G20 G20 The Group of Twenty (G20 or G-20) is a group made up of nineteen countries and the European Union whose ministers, central-bank directors and heads of state meet regularly. It was created in 1999 after the series of financial crises in the 1990s. Its aim is to encourage international consultation on the principle of broadening dialogue in keeping with the growing economic importance of a certain number of countries. Its members are Argentina, Australia, Brazil, Canada, China, France, Germany, Italy, India, Indonesia, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, USA, UK and the European Union (represented by the presidents of the Council and of the European Central Bank). , World Bank, and IMF, who have the power to face the deep crisis, unlike the United Nations.

In line with its transforming analyses and practices, CADTM in the following years significantly changed its structure and eventually even its name. On the one hand, it further de-centralized its activities to combat North-South asymmetries, and on the other it expanded its intervention in Northern anti-austerity struggles.

Until the global assembly in the Moroccan city of Bouznika in 2013, CADTM Belgium had solely managed the International Secretariat, but from then on successively shifted responsibilities to Attac/CADTM Morocco in order to eventually share Share A unit of ownership interest in a corporation or financial asset, representing one part of the total capital stock. Its owner (a shareholder) is entitled to receive an equal distribution of any profits distributed (a dividend) and to attend shareholder meetings. the secretariat (CADTM International 2013). The idea had already been discussed since the 2010 global assembly in Belgium (CADTM; Toussaint 2013). The actual implementation was successively impeded by repression of the Moroccan authorities (CADTM interview 2), but the decision was evaluated positively and confirmed at the following global assembly in the Tunis suburb of Borj Credia in 2016, where the event was held since Moroccan authorities refused to issue a permission for the event (ATTAC/CADTM Maroc 2016). At the same assembly the network also decided to change its name to “Committee for the Abolition of Illegitimate Debt,” but keep its trademark acronym. The decision was justified with the re-configuration of North-South relations vis-à-vis the recent crisis:

The CADTM network name change is justified by the evolution of its work in industrialized northern countries. CADTM was founded in 1990 in the middle of the Southern debt crisis to demand the cancellation of the debt of countries known as the Third World, but over time the term “Third World” is used less and less. With the 2008 financial crisis and its repercussions, the CADTM’s sphere of activity has gradually extended to public debt in the industrialized North, without giving up anything in regards to demanding cancellation of so called “Third World” countries’ debts. The CADTM has shown how the whole “debt system” subjugates people in the south just as much as people in the north of the planet. To address this whole “debt system,” the CADTM has developed a new strand of action and reflection on the issue of illegitimate private debt, such as that related to micro-credit in which women are the primary victims, farmer debt, student debt, families evicted by banks, etc. The concept of “illegitimate debt” can encompass both public and private debt in theSout h and the North. Finally, the term abolition is stronger than that of cancellation in the sense that it demands the disappearance of even the concept of illegitimate debt. (CADTM International 2016).