ISGN > Publications > JUBILEE, DEBT AND THE IMF

Speech by Ann Pettifor, Co-founder Jubilee 2000 UK.
In a conference organised by ISGN in Bangkok, February 11, 2000

The Jubilee 2000 campaign is built on a straightforward analysis - developed before the campaign was launched in 1996: that the unpayable debts of the poorest countries are kept on the books by the richest nations as a way of perpetuating their bondage. That debt is the most potent form of slavery. It is for this reason that the key symbols of our campaign are chains.

We spent a long time developing our analysis before launching the campaign. Getting the analysis right is pretty important if the strategy and tactics of the campaign are to be effective. We've watched as others have analysed situations incorrectly, and thereafter made huge strategic and tactical errors. An example is the analysis of those who celebrated after the collapse of the Berlin wall - heralding the change as the dawn of a new golden era. How wrong they were. But their initial analysis was not just wrong; it led to huge strategic errors. Those claiming to be on the side of the losers of the Soviet system, aligned themselves with those who gained from the collapse of communism, and (perhaps inadvertently, but nevertheless irresponsibly) helped intensify attacks on the living standards - and lives - of millions of people in the old Soviet Union.

Another false analysis, in our view, is that "there is no debt". That poor countries are the creditors and rich countries the debtors. It is of course obviously true that rich countries have looted poor countries, and continue to do so; that there are substantial debts owed by the activities of the colonialists; that there is a vast carbon debt owed to the poorest countries. All this is true. Nevertheless the analysis that "there is no debt" leads to
an ideological cul-de-sac. For as we speak, rich country creditors, with the often active support of elites in debtor nations, are transferring wealth from the poorest countries to their own coffers, as repayment of debts. The analysis of "there is no debt" leads to passivity in the face of this transfer. It paralyses action. For it is this transfer that must be
urgently stopped, if the rich countries are not to perpetuate debt bondage, and bleed the economies of the poorest countries.

So it's important to get one's analysis right. We were critical of those who majored on the question of structural adjustment policies. We analysed SAPs as policies whose real purpose (often obscured by the rationalisations and confusions of the IFIs) was straightforward: the forcing open of markets of the poorest countries. (The range of policies used for achieving this objective provide creditors with a wide smokescreen for their real intent; fighting these policies is like fighting an enemy with its troops strung
along a very long border.) However we noted that without high levels of indebtedness, it was impossible for the richest nations to obtain leverage over these countries - to impose structural adjustment policies and then force open capital and goods markets through the IMF/WB/Paris Club.

So debt, we analysed, is the key mechanism for subordinating the economies of the poorest nations to those of the richest nations.

Hence the need to break the chains of debt.

We were also aware that campaigners were pretty ignorant about the debt; how much was owed; who it was owed to (mostly Export Credit Guarantee depts and the IFIs) and how it was manipulated and controlled by creditors. We determined to educate and inform our supporters of the way in which the system worked - in order to empower them to challenge it effectively. We're a long way from our goal, but one of our greatest achievements has been to educate and empower a wide swathe of society in the north - and the south - by educating them in the ways their own governments operate - as lenders or borrowers.

Our anger was directed at the injustice of the international financial system - dominated as it is by creditors. Answerable neither to the rule of law, nor even the rule of the market. The IMF and World Bank operate as if they are highly protected, nationalised banks - backed by the Treasuries of the US, the UK and Japan. They are thus immune to market forces. Like Soviet-style banks, they can make gross errors, and never suffer the consequences. On the contrary, they simply transfer losses to the poorest people in the poorest countries of the world - and are bailed out by taxpayers in the north.

So they are neither punished by the market; nor challenged by international law. The international financial system is a wild west dominated by cowboys holding innocents to ransom.

So for all these reasons we set out to remove the economic lynchpin that deprives poor countries of autonomy, gives the IFIs such huge delegated power, and enables the G7 to impose so-called structural adjustment policies which force open developing country markets. The lynchpin that is debt.

The campaign in Britain was designed on certain principles.

• That it should be based on the Judaeo/Christian principle of Jubilee; of periodic correction to profound imbalances; and for an end to debt slavery;
• That it should be broad-based and non-sectarian, in order to attract mass support for an end to debt bondage. We vowed to unite all the faiths, the aid agencies, the medical community, youth organisations - and to bring them together with the Labour movement and the black communities of Britain. Despite huge tensions, we have succeeded in this.
• That we would not target the civil servants at the IMF and World Bank. We define these institutions as "soft targets" - used by the powerful to deflect attention from those wielding power. We analysed that the tactic adopted by the G7 of remaining hidden behind their civil servants in Washington, while allowing these civil servants to take the blows of public opinion, was an effective tactic on their part. The "invisible hand" of the G7 remains invisible. We resolved to make their role visible. We also believe that campaigners invest too much power in the IMF and WB, thereby inflating the arrogance of these civil servants. Furthermore, by suggesting that power lies with civil servants and the bureaucracy, campaigners help to downgrade the political power of elected representatives. Of course we criticise IMF/ WB civil servants. But we target the real power-brokers. And we encourage politicians to respond to democratic mandates. That is why we mobilised 70,000 people around the G7 Summit in Birmingham in 1998, and Cologne in 1999. And that is why we are putting such pressure on Japan this year, as leader of the G7 - and the toughest target of them all.
• That the campaign in the north would not speak for the south; rather we would hold our own elites to account for actions taken in the name of taxpayers and electors - in London, Washington or Paris.
• That, while not speaking for the south, we would make platforms available in the north, for representatives from the south, so that people from the south could make their case - in the media and political courts of the north - against the debt and its impacts.
• That if campaigns were to grow up in other countries, then we would encourage co-operation on the basis of autonomy for each Jubilee 2000 campaign - and, while respecting the principles of the petition "to cancel the unpayable debts of the poorest countries by the end of the year 2000 under a fair and transparent process" we would respect the need for campaigners to respond to political conditions in their own environments.
• That we would become well informed, and would track and spotlight the activities of the major creditors. We committed ourselves to high levels of accuracy and high standards of research and up-to-date information.

I was deeply involved in the design of the campaign, and my own experience was brought to bear on its approach. My background is in the labour movement, but also the women's movement. In the British women's movement we hold dear the principle of self-organisation; and in our struggles had worked alongside black community groups, respecting their right to self-organisation. I am also a South African, and had found myself at odds with the South African communist party - which had allowed a white man, Joe Slovo, to take the leadership of a black struggle. To me this was unacceptable. So we were clear that Jubilee 2000 campaigns in the north could not speak for, or lead
struggles against the debt in the south. On the contrary, we were perfectly well aware that we were catching up, simply following the leadership given by those in the south resisting the debt for many years before the Jubilee 2000 campaign got started.

We modeled the campaign, quite consciously, on the struggle against slavery. That struggle had begun in the communities in Africa and elsewhere, from which men and women were stolen for slavery; and had continued in the plantations of the Carribbean, Latin America and the US. After many years, Christians and other people of conscience in the north, responded to these struggles, and began to apply pressure on their own governments and commercial elites.

As Martin Kohr has noted, the campaign can also be compared to the struggle against the Vietnam war. That too was fought on the bloody battlefields of Vietnam. But it was when the struggle was taken up on the campuses of US universities, that the tide of public opinion began to turn against the US military industrial complex, a turn that would eventually lead to its defeat on the battlefields.

What have we in Jubilee 2000 achieved? For a start we have lifted developing countries right to the top of the political agenda within the G7. At the last two Summits (in Birmingham and Cologne) poor country debts have been high on the agenda. At the recent European/African Heads of State summit in Cairo it was a major item on the agenda, and African leaders were aware that, thanks to Jubilee 2000, they had European public opinion on their side.

In Britain and in some other countries, we have mobilised public opinion on a mass scale in support of debt cancellation. Our support crosses the political spectrum, from right to left, so that we have built a powerful consensus. We have made use of sophisticated communication techniques in doing so. We have educated millions of people in the workings of the international financial system. We have raised complex issues and placed them on the agendas of the media - who have had to come to grips with the complexities and realities of international financial relations. Popular magazines in Britain and Italy and Scandinavia, now routinely report on the indebtedness of the poorest countries.

We vowed never to go to indebted nations to organise there; but instead to look to build alliances with those engaged in struggle against the debt in those countries. Where alliances have been forged on the basis of mutual respect, we have tried to strengthen the voice of those disenfranchised in the south.

We have undertaken high level advocacy, challenging the experts and elites of the IMF/WB and Paris Club. We have exposed their innermost secrets; above all we have exposed their phoney calculations and methodologies.

And we have succeeded in getting promises of $100bn of debt cancellation; and $13 bn of actual debt cancellation, by March 2000.

These are modest achievements. But we hope they will contribute towards a real shift in the balance of power away from international creditors as masters and sovereign debtors as subordinates.

Ann Pettifor

Bangkok
February 11, 2000