Life and Debt

By Published On: December 18, 2006Categories: Debt, Economy0 Comments on Life and Debt

Five-year old Rosemary tore into the sachet of milk with her teeth. She sucked contentedly. “Today’s breakfast is the one I like the best,” she said, pausing to take a munch on an empanada (pastry).

Ana next to her in Callapampa primary school, kept a shy silence hiding behind her hair when I asked her questions. Rosemary, Ana and another two hundred and fifty children’s breakfast at the school, in a strange way, are connected to a job and passion of mine in the 1990s.

Ten years ago, I got my first full-time job much to the relief of friends who had had enough of me scamming what I could to survive London life. It wouldn’t be an exaggeration to say that the office conditions contravened all health and safety laws. I was based with one colleague Celia in a plastic shed on a roof of a building surrounded by cardboxes full of leaflets and booklets that tottered high and dangerously above me.

During December, I would squat on the chair to keep my legs away from the freezing drafts of wind that whistled across the floor due to the clever design-planning of the shed that left a gap between the walls and floor. My first task was to input the first 80 contacts, friends of the founders of the organisation, onto a database. I was commissioned grandly to help build a global movement.

Four years later, I was in a much bigger office with another mountain of boxes, this time full of 24 million petition signatures, and the name of the movement was known worldwide. The movement was Jubilee 2000 and its aim was to cancel the debt of the poorest countries by the year 2000.

And Rosemary’s breakfast? Well it was funded with resources from debt relief, ensuring that every child in La Paz gets at least one nutritious meal each day.

The school breakfast is a powerful symbol of the power of campaigning. It reminded me of my first experience of the impact of debt when I visited a friend’s mother in the lush-green foothills of Mount Kilimanjaro in 1992. Susan was a teacher and talked of her students being listless in the morning as they didn’t get any food in the morning. Tanzania was then diverting far more money towards paying debts than it was able to invest in education.

I started campaigning on debt at University in the early 90s but started work for Jubilee 2000 in 1996. My four and a half years working directly on the campaign were some of the most formative of my political life. I saw incredible commitment from unacclaimed working people dedicating their energy, time and creativity to the campaign, I observed the power of popular pressure as it forced governments and politicians to change their minds and start applying different policies, and I experienced the divisions, power struggles and personal bruising that exists in movements.

One moment in particular will always be etched in my memory – 2.15pm on 16th May 1998 when after 6 months of trying to mobilise people to come and form a human chain around the G8 rich nations’s summit, I headed out to my bit of the chain with several international campaigners. Our plan to form a human chain of ten kilometres on an issue that primarily affected people outside Britain seemed far-fetched. But as I ran along the streets past thousands and thousands of people linking hands making a barrage of noise, I knew we had done it. The buzz I felt that day has never been surpassed.

Therefore it’s rather suitable that ten years on, I have spent the last six weeks focused on debt. I spent a month dedicated to writing a book chapter on the impact of debt cancellation in Bolivia. Then this week, I went to Honduras to do a couple of presentations – recalling the lessons and experiences of the Jubilee 2000 campaign to guide future campaigning and sharing an analysis of the debt relief process in Bolivia. The conference brought me back together with several key campaigners in Honduras who I used to work with. Francisco Machado, the coordinator of the campaign whose shiny bald head matched mine, joked that we had “both lost hair together in the struggle.”

The stories from Honduras and Nicaragua were very similar to Bolivia’s. All three countries qualified for the World Bank and IMF Highly Indebted Poor Country Initiative (HIPC) and have had significant debts cancelled. In the case of Honduras, it is $2.9 billion over 40 years; Bolivia $682 million received between 1998 and 2004. All three countries have invested the money that no longer is being used to pay debts towards investments in health, education and infrastructure. This is money that has ended up, for example, in sachets of milk for Rosemary.

However there is also evidence that the money is not always getting to those who most need it. Surveys in Bolivia show that most medical staff that have been employed have merely filled a major deficit in health posts and have not been allocated to the poorest areas. In Honduras, Santos Escobar, a farmers’ leader at the conference said: “When you see the failure to meet people’s basic needs in the countryside, then we can only call the debt relief, that we have received, an insult. It has provided very little resources and even then only five to ten per cent gets to people”.

The biggest source of shame for the international community is that at the same time as it proclaimed poverty reduction to be at the heart of debt relief and the philosophy of international financial institutions, poverty in both Honduras and Bolivia has gone UP. In both countries, two thirds of the country is under the poverty line. According to the UN, 130,000 new impoverished people are added to statistics in Bolivia every single year. Oscar Carvajal, the head of Callapampa school told me that for some kids in his school, the breakfast is clearly their only meal and is probably the only reason they come to school. “20% of the children don’t turn up when there is no breakfast” he commented.

There is no doubt that debt relief has delivered – in improving access to basic services like health and education. This does make a difference in peoples’ lives. But in Honduras, Bolivia and Nicaragua it is failing to make even a dent in poverty in terms of income. Neither Honduras and Bolivia are likely to meet the international community target of halving poverty by 2015.

This is in part because these countries have been applying IMF policies with a few social add-ons and not making the necessary investment in productive activities and areas which can create jobs and income. Both Honduras and Bolivia have left too much of the economy to the market assuming that growth would lead to poverty reduction. This has not only led to little economic growth but any growth has just enriched a few. Increasing evidence shows that the State has to intervene strategically to make sure that the benefits of growth are distributed more widely.

Bolivia’s new government has made signs that it will put more focus on redistribution and on building up small businesses and rural producers, rather than just growth and attracting foreign investment. However it remains to be seen how these plans are converted into reality. Honduras, however, seemed wedlocked to the idea that foreign investment and growth would translate into poverty reduction. As a Government Minister at the conference in Honduras scrabbled for a weak explanation as to why poverty had grown, I could hear the workers changing shift at a maquila factory next door (factories that don’t pay taxes providing cheap labour to produce parts for multinational companies).

The hope for me lay in the fact that ten years on, the campaigns in Honduras and Nicaragua are still going strong. In Honduras, civil society movements had just forced the Government to back down on building an airport in an ecological and archeological sensitive area. In Nicaragua, Georgina from the Civil Society Coalition reported that thousands of Nicaraguans had marched recently against IMF imposed conditions and that their manifesto for transformation of Bolivia had been signed by the incoming President Daniel Ortega.

The Jubilee movement for a “fresh start for indebted countries” six years in to the new century clearly still has plenty of work ahead. But from what I have seen in Honduras and in Bolivia the experience of the campaign gave them more legitimacy and space in society which they are using to ensure that all the State’s resources (whether freed up by debt relief or not) are used for the benefit of all and not just a few.


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