MIM Notes No. 198, November 15, 1999 Imperialist deathgrip of debt strangles Third World by MC17 At the same time as the annual meeting of the World Bank and the International Monetary Fund (IMF) -- the imperialists' two centralized banks -- was coming to an end in September, there was a measured increase in the gap between the world's poor and rich. The poor are the world's majority; the rich the minority, including the parasites within First World countries who make up the well-off labor aristocracy. According to the United Nations' 1999 Human Development Report, the top 20 percent of the world's population earned 74 times as much as the bottom 20 percent. This is up from a gap of 60 to 1 in 1990 and 30 to 1 in 1960.(1) As part of our fight against the oppression of the world's majority by the wealthy imperialists and their representatives, MIM joins the international call for the imperialists to write off the unpayable debt owed by the poorest Third World countries by the year 2000. At the same time, we call for all "debt" to the imperialists, by any Third World country, to be unconditionally canceled because in reality, it is the imperialists who owe a huge debt to the Third World. We speak of the Third World countries "owing" money to the wealthy countries with our tongues in cheek. For as long as there have been relations between the governments of Europe and the united $nakes on one side, and the peoples of Africa, Latin America and the vast portion of Asia on the other, the masses of the poor countries have toiled to support the wealth of the rich. Colonialists and then imperialists have robbed the Third World at cannon-point of raw materials and labor. Their so-called loans come back to them hundreds of times over in payment for overpriced finished goods and services. Since the 1980s, many Third World countries have taken out huge loans from the United $nakes, England, Japan, and other imperialist countries, as well as the IMF and the World Bank. These loans far exceeded the capacity of the countries to repay. As a result, the interest and further loans taken out to pay back original loans have led to spiraling debt. MIM maintains that the real debt is owed by the imperialists, who have stolen from the rest of the world and owe reparations. The World Bank, made up of member countries from around the world, is controlled by the countries that contribute the most money. The U.$. is the largest contributor, giving 17.9%, followed by Japan (7.43%), Germany (5.74%) and France and Britain (5.5% each). Each of these five countries appoints an executive director who determines World Bank policies and approves loans. The remaining 171 countries share 19 executive director positions.(2) The World Bank is traditionally headed by an Amerikan. Its current president is James Wolfensohn, an Australian born Amerikan. Membership in the World Bank is required for membership in the IMF. The IMF gives short-term loans in return for countries following its Structural Adjustment Programs (SAP). The U.$. gives the IMF 18% of its money. The five countries which control the World Bank also control the IMF, with 40% of the voting power.(2) At the annual meeting of the World Bank and IMF in Washington in September, a new group, the GX, was unveiled which is meant to replace the G7 (US, Japan, Germany, France, Britain, Italy and Canada) as the controlling force of economic policies in the world. Said to reflect the new world economic order, the GX includes China, India, Brazil, Mexico and South Korea (all qualifying based on size), Russia (because of its strategic and economic importance), South Africa (because they could not find a better imperialist lackey country to represent that continent) and Saudi Arabia (because it is the world's largest oil producer).(3) So even if the GX does take over economic decisions previously made by the G7, nothing will fundamentally change. The countries included were carefully chosen for their loyalty to imperialism. At the joint seminar of the World Bank/IMF in 1998 the World Bank president announced that it would be taking on a kinder gentler mission. Wolfensohn then claimed, "Poverty reduction is at the heart of the Bank's mission."(4) In Indonesia, the World Bank and IMF gave the Suharto regime $43 billion over three decades. Now, when the world's attention has turned to the Indonesian atrocities against East Timor, the World Bank and IMF are scrambling to justify their blatant material support for fascism. So far, their best excuse is simply that they believed the Suharto government when it claimed to be making epic improvements in living standards.(5) After the post-election massacres in East Timor led to international outrage, the IMF suspended loans to Indonesia, supposedly to protest the atrocities in East Timor. But with a little political posturing by any of the potential puppet candidates for the Indonesian presidency, these loans are sure to be reinstated with little fundamental change in Indonesian government policies or practice. The change of rule over East Timor from Indonesia to the United Nations (led by Australia, which would love to have East Timor as its own colony!) does not mean that the IMF somehow pressured Indonesia to reform its fascist ways. Indonesia had already decided that East Timor was impossible to retain as a colony with the strong resistance movement there and growing internal anti-government protests at the same time. Rather, the IMF publicity stunt fits in with its attempt to remold its image without really changing its policies. In late September, the IMF announced that it would shift its policies towards more of an emphasis on poverty reduction in the Third World. It is renaming its Enhanced Structural Adjustment Facility -- the program of making cheap loans to poor countries in exchange for harsh economic and social restructuring measures -- the "Poverty Reduction and Growth Facility." (6) Regardless of the name, this program will continue to be the cause of increasing poverty for the majority of the people in the countries which are victim to this IMF scheme. Structural Adjustment policies require countries receiving IMF loans to implement changes in internal economic and political policies, such as cutting social programs, banning labor organizing, and increasing the poverty of the majority of the people in the country while a few government officials and many foreign corporations get rich with the IMF loan money. MIM credits the Jubilee 2000 Campaign (http://www.jubilee2000uk.org) for initiating the call for a "debt-free start to the Millennium for a billion people." We unite with the campaign in this demand, but we take this issue further to demand that the imperialist countries free all of their colonies from all debt, and from political, economic and military dependence. This call for debt reform is an excellent opportunity for education. If won, it would be an objective gain for the Third World proletariat over imperialism. For this reason, MIM takes up the call as part of our fight to end imperialist domination of the Third World. The Jubilee 2000 campaign name is inspired by the biblical year when slaves are set free. MIM and RAIL do not need religion to demand an end to Third World countries' enslavement to imperialism through debt. But we understand that this is a good opportunity to mobilize people who can see justice in ending the economic strangulation of the Third World. Join MIM in fighting the imperialist deathgrip of debt. Organize protests, educational events, and other actions in November and December. Contact us to arrange for speakers or to get copies of movies about international debt. Send us art to use in our propaganda for this campaign, print out this statement with MIM's contact information, and build support for the struggle against imperialist domination. Notes: 1. 1999 UNDP Human Development Report. 2. Real World Macroeconomics. September/October 1994. Page 107. 3. The Guardian Weekly 23-9-1999, page 12. 4. The Business Standard, October 8, 1998 5. IPS, Sept 22 1999. 6. Reuters, Sept 28, 1999.