Wall Street and the Aztecs: The Case for Repudiation of Third-World Debt

John McMurtry

Variations on the story of US and allies’ investment and debt stripping of societies by financial means have occurred in almost every region of the world in just the last 80 months - Mexico in 1994, Thailand, Indonesia and Korea in 1997, Russia and its former territories in 1998, Brazil in 1994 and 2001, Africa throughout. Now there is Congo in the waiting whose US-brokered “peace” requires the same financial and trade deregulation. Who will be next? The run will not stop as long as governments continue to obey transnational financial demands for ever more “free capital and commodity circulation” and “public sector privatization” and “deregulation”.

As I write, the corporate servo-mechanism of Tony Blair’s British “government” is preparing to demand that the European Union itself embrace a radical program of still more “financial liberalization” as well as “removal of barriers” to “private management of public services” and “investment of pension funds”. With not even a pretended “miracle” left in this catastrophic experiment on the world, finance and media-engineered heads of state keep driving the juggernaut at breakneck speed in prostrate obedience to the gods of the corporate system. Far more remarkable than the daily parades of thousands to the Aztec killing steps, only more sacrifices for “financial liberalization” and “privatization” are demanded and made as the bodies of wrecked economies, destabilized societies and depredated environments pile up around the globe. One can’t get through a day without some government, including our own, scrambling to set the public agenda to the same social death march.

This is the hysteria of a collapsing paradigm of governance, but the mindset of the servants is as fixed in the spells of market magical thinking as the priest removing the beating hearts of captured humans to ensure the return of the sun.

The Mind-Lock of the Beast

A poignant example is the heroic jubilee 2000 campaign for cancellation of poor countries’ debts. Publicly celebrated after years of international pressure when the Cologne Summit of world leaders finally promised a 90% forgiveness of the debts of “Highly Indebted Poor Countries” in 1999, one imagines it was a success. But the disorder was not plumbed. In fact, debt payments from Highly Indebted Poor Countries increased during the height of the international pressure from 1996-99 by 25%; only 21 countries of the 187 indebted developing countries ended up qualifying for debt reduction; and the hidden conditions turn out to be, as usual, social stripping of the nations bound to them - privatization of communal lands, abolition of public subsidies for basic survival staples, pricing of public education and healthcare to the poor, non-progressive tax rises, dismantling of home-industry protection, and the selling of public firms.’ What alone changes is the name for the social death-sentences. Structural Adjustment Programs are now depolluted by incantations of “Debt Forgiveness Plans” and “Poverty Reduction and Growth Facilities” to ward off the contagion of reality - just as VITO and FTAA fiats are now conjured as “plans to reduce poverty”. The clear pattern of fact that all of this “financial and trade liberalization” in fact impoverishes and casualises social majorities of populations across the world and confiscates the lands and resources of subsistence communities by country-sizes every year is kept under wraps.

As social intelligence comes to learn, the Beast’s face is increasingly dressed in the clothes of the Lamb. Even the deepest social ethical tradition of the Judaic-Christian’s Holy Bible is sworn upon before tens of millions of uplifted voices while, all the while, transnational bank feeding on the poor in fact increases.

Debt Cause, Debt Solution

The mainly post-1970 national debt regime has ruinously replaced the public loans, national self-financing and low-interest government-to-government lending which lifted the developed world out of the Depression, financed the defeat of Axis fascism in the Second War, and rebuilt Europe and Japan from 1945 to the 1970’s. The national debt siphon of private banks and bondholders given free rein on world economies since did not fall from the sky as a commandment of economic laws. It has been evolved in hidden pattern through known determinants which are not connected: