Thursday, July 2, 2009

Some History of Debt Colonialism

"Were I a Third World Leader in the dock, accused of getting my country hopelessly ensnared in debt, my defence would be that money was too cheap in the 1970s not to take advantage of the windfall...How was I, a debtor government, to foresee - much less control - the unprecedented upward swing of interest rates, due largely to demented military spending by the capitalist world super-power? I would further tell the jury: 'Every single Western expert who ever came to our country, especially those from the development banks, told us that to develop we had to industrialise. Was our country to remain for ever in peonage, exporting raw materials North so that others could transform them into finished goods and make all the money? Where were we supposed to get the capital for energy and for industrialisation if not by borrowing?" [1]

"...a large part of the cost of controlling inflation and introducing structural change in the North was borne by the South. Developing countries had to pay out more and more to service their debt whild receiving less and less for their exports. As these contrasting movements aggravated their financial difficulties, commercial banks decided to stop lending them new money, and the result was the international debt crisis of the 1980s." [2]

"Underdevelopment, far from constituting a state of backwardness prior to capitalism, is rather a consequence and a particular form of capitalist development known as dependent capitalism." [3]

[1] Susan George (1988) 'A Fate Worse than Debt', Pelican.

[2] The South Commission, The Challenge to the South, Oxford University Press

[3] Political Scientist Theotonio Dos Santos, 1969


Shag from Brookline said...

Is this an application of the zero sum game in globalization?


"Were I a [highly industrialized nation] Leader in the dock, accused of getting my country hopelessly ensnared in debt, my defence would be ______________."

fill in the blank.

Myrtle Blackwood said...

Yes. A zero-sum game for all of us.

Our 'leaders' have wanted to sustain the unsustainable profit engineering by going to so-called 'emerging nations' to counter the very effects of the overconsumption they promote.

Page 196
"Escalating energy demands throughout the industrialized world, the intensifying competition for profits by employing cheap labour in tropical islands, African jungles, and the Chinese countryside, and the frantic search for out-of-the-way places to locate contaminating factories...

Page 190
"In 1900 Paul Resenstein-Rodan points out, people in poor countries had a per capita income about one-half that of people in rich countries. By 1970 the per capit income in poor countries was about one-twentieth of that in rich countries, measured in 1900 dollars (or one-fortieth in 1970 dollars)."

‘Global Reach – The Power f the Multinational Corporations’ by Richard J Barnet & Ronald E Muller. Publisher Simon and Schuster’. 1974. SBN 671-21835-2 Casebound. Chapter 8: ‘The Power of the Poor’

In 1996:
"the poor of the earth still constitute the majority. In 1990, 53% of the world population lived in countries where average dollar incomes were less than $500. And the poor still live much as they did in the past...They are still mainly rural, still dependent on primary commodities, still hungry, ill in health, ill-housed and ill educated. Women are still oppressed, and birth rates remain high."

Page 12
"the developing world has 75% of the world's population ....(and) 17% of the world's GDP.

Page 39 '75/25 - Development in an Increasingly Unequal World'. Editor Colm Regan. Published by the Development Education Centre, Birmingham in association with CAFOD and SCIAF and in parntership with Dochas, Ireland. 1996.