Making the Case for Jubilee: The Catholic Church and the Poor-Country Debt Movement
Donnelly, Elizabeth A., Ethics & International Affairs
The pledge by the Group of 8 (G-8) in July 2005 to cancel all the debt owed by eighteen, and ultimately more, heavily indebted poor countries to the International Monetary Fund (IMF), the World Bank, and the African Development Bank was the most recent victory in a series of campaigns by a broad-based coalition of churches and NGOs that had begun more than twenty-five years before. In the late 1990s, the movement grew considerably and achieved its most extraordinary mobilization in the Jubilee 2000 campaign, which successfully touched masses of people around the world with a moral message that politicians could not ignore. There are not many instances in modern history in which moral appeals based on religious principles drive political change (albeit limited). The civil rights movement in the United States may be one example. The struggle against apartheid in South Africa may be another. The anti-debt movement may be a third.
To better understand why the appeal has been so strong, this essay examines the ideas and ethical argumentation of the Catholic Church that have guided its involvement in the global debt campaign since the early 1980s. The focus is warranted because the Church played a leading role from the earliest days of the campaign by virtue of its size and vast array of resources. Its actors on the debt question have included individual Catholics, parish-based justice and peace groups, church personnel (especially missioners), religious orders and their social action offices, relief agencies, academics and universities, national episcopal conferences, the Vatican's justice and peace office, and Pope John Paul II. The global coalition's most extensive and best-known moral arguments for debt reduction originated at Catholic bishops' conferences and the Vatican. Statements from the Church leadership especially were addressed to both Catholics and non-Catholics among the general public and policy-makers. By stimulating discussion in policy circles, they strengthened the legitimacy of the fundamental claim that excessive sovereign debt servicing was unjust. The essay looks more closely at the two most widely disseminated and influential Church statements-by the Vatican and by the U.S. bishops which have served as benchmarks in the Church's long engagement with the anti-debt campaign.
THE MORAL MESSAGE IN THE APPEAL FOR DEBT CANCELLATION
Emblematic of the appeal of debt cancellation was Carmen Rodriguez, who headed the Catholic Charismatic Movement in a sprawling shantytown parish south of Lima, Peru. She and other lay leaders of her diocese prepared for the new millennium in a rather unusual way. In early 1999, they participated in workshops offering economic and theological perspectives on the theme the Peruvian Catholic bishops had chosen for that year's Lenten observance: debt relief. They went door to door and gathered some 90.000 signatures on a petition, calling for a one-time cancellation by the end of 2000 of the unpayable debt of highly indebted poor countries. More than 1.8 million Peruvians in just three months' time and 17 million people from over 160 countries signed the petition, which was organized by a coalition of churches, antipoverty groups, and other civil society organizations as part of the Jubilee 2000 campaign. The delegation presenting the petition to German chancellor Gerhard Schroder, who accepted it in the name of the G-8 leaders in Cologne in June 1999, included such disparate figures as Archbishop Oscar Rodriguez Maradiaga of Tegucigalpa, Honduras, and Bono of the Irish rock group U2.
Jubilee 2000 organizers, led by such groups as Christian Aid U.K., Oxfam, the European Network on Debt and Development, a Washington-based coalition of church and anti-poverty groups, and Catholic national episcopal conferences, relief agencies, and the Vatican, argued that heavily indebted countries devoted an inordinate portion of their national budgets to making interest and principal payments on their debt, leaving too little available for desperately needed outlays for health, education, housing, and job creation. Invoking a biblical prescription for periodic debt relief, the coalition urged the international community to mark the millennium by recognizing a period of "jubilee" for poor countries, in which government debts would be canceled and the freed-up resources used to alleviate poverty. Of particular concern were thirty-six low-income and twelve middle-income countries the World Bank categorized in 1998 as "severely indebted." (1) The coalition also protested the disproportionate burden placed on the poor by structural adjustment programs (SAPs), mandated by the IMF and the World Bank as conditions for debt rescheduling and reduction. Such programs have regularly featured deregulation of the private sector, the privatization of government-controlled industries and services (causing cuts in jobs and wages), and cuts in government budgets, which have typically slashed food subsidies and spending on health and education.
NGOs and churches had been working to alleviate the harmful consequences of debt and structural adjustment since the late 1970s, with efforts at national, regional, and then global collaboration, leading to a functioning transnational network by the late 1980s. (2) Efforts in the 1980s principally focused on large, middle-income countries, especially in Latin America, whose possible default on commercial bank loans threatened the stability of the international financial system. Limited debt reduction, followed by rapidly expanding international private-sector investment in "emerging market" countries in the early 1900s, largely defused the crisis in the eyes of creditor country policy-makers and the international media. The poorest and most heavily indebted countries were largely bypassed, however, and the growing civil society network turned its attention to pressing for debt relief for these countries, which tend to owe the vast majority of their external debt to bilateral and multilateral creditors, rather than commercial lenders.
Subsequent government crises in the late 1900s and early 2000s in Ecuador, Argentina, and other middle-income countries showed that the euphoria of investors for emerging markets would not save those countries from being vulnerable to new external debt crises. The anti-debt movement thus found itself needing to refocus on the lack of a coherent and comprehensive international mechanism for dealing with countries' unsustainable debt burdens. In other words, under existing solutions, debts were not being adequately reduced. A concrete proposal for "financial architecture reform" was thus advanced within the Jubilee movement, as in the joint call of the large networks of Catholic relief and development agencies for a "fair and transparent arbitration process." (3) While it has yet to win broad international acceptance, its appeal embodies essentially the same moral outrage as in the straightforward call for debt cancellation for the poorest countries: the international community expects developing countries--and especially poor people in those countries--to bear the consequences of excessive debt burdens, and that is immoral.
Throughout the campaign, the moral inspiration has been the biblical call for jubilee. According to the concept found in Leviticus 25 and Deuteronomy 15, justice required that the Jewish people should periodically--sometimes said to be every seven years and other times every fifty years--free slaves, redistribute land to its proper owners, and cancel debts in order to respect the human dignity of debtors and restore the bonds of community fractured by exploitation, greed, and the vicissitudes of economic activity. The case for jubilee debt cancellation, made throughout the 1980s, became a vital and effective frame for the campaign in the second half of the 1990s: activists identified the year 2000 as the jubilee year, and people around the world saw substantial debt cancellation as a fitting and sufficiently grand way to celebrate the new millennium.
The call to jubilee as articulated in the Catholic tradition is grounded in Catholic social teaching, a tradition encompassing ethical norms from the Bible, the work of such major theologians as Augustine and Aquinas, and social encyclicals and letters promulgated by popes and, more recently, national bishops' conferences. Its key principles are that each person is endowed with essential human dignity as a child of God, and individuals and institutions are obliged to protect and promote the dignity of persons. Also, people are social in nature, created by God as one single family, and must be committed to promoting the common good, the sum total of those conditions in society that make it possible for all persons to achieve their full potential, with the understanding that governments also have the duty to promote the common good. This ethics of solidarity, in which all assume responsibility and work together for the effective realization of the unity of the human family, must not only be proclaimed at the level of principle but also be translated into concrete policies and institutions. All people of goodwill are thus challenged to exercise a preferential option for the poor in examining the social impact of economic and financial policies and institutions. If the latter are organized in such a way as to injure the poor and exacerbate their poverty, one should consider them to be a form of institutionalized violence and social sin that should be addressed. In this analysis, the debt overhang is a structural block preventing the realization of the sustainable, integral human development valued in Catholic social teaching. Debt relief, then, must be linked to poverty alleviation.
Catholic social teaching also advocates subsidiarity, the principle that, whenever possible, individuals and local institutions should take responsibility for policy solutions. Subsidiarity has dual implications for the debt question: civil society in debtor countries must participate in decision-making on debt, and problems that cannot be solved by individuals, civil society, or national governments must be addressed by international structures. Thus, national debt crises are part of a growing list of issues on which people are called to greater international solidarity because of increased international economic interdependence.
The Catholic tradition also evaluates the debt question by theories of justice. While commutative justice implies a moral presumption that contractual obligations such as debts should be honored, distributive justice (the requirement that the allocation of income, wealth, and power in society be evaluated in light of its effect on persons whose basic material needs are unmet) may require that debts be canceled. Moreover, social justice (the imperative that all persons should be able to be active, productive participants in the life of society and that society should develop the full range of social, economic, and political institutions that enable individuals to do so), a key element of Catholic social thought, adds theological weight to the call for relief from debt.
These ethical principles nevertheless leave open the question of whether policy changes should be reformist or radical. Indeed, a reformist/radical cleavage has marked the debt network since the mid-1980s, increasingly lining up on a North (reformist) versus South (radical) axis. Catholic and non-Catholic activists alike have consistently had sharp debates over policy and strategy, most basically on the question of whether to reject SAP conditionality entirely and demand complete and unconditional debt cancellation, or accept with qualifications substantial debt reduction with reformed conditionality geared toward poverty alleviation. Nevertheless, with activists conscious that splitting the movement would seriously weaken it, the dominant tendency has been to seek common ground and maintain a steady critique of target institutions while welcoming incremental improvements in policy.
HOW CHURCH VIEWS DEVELOPED: "1970s TO 1980s
The "Mexican Weekend" of August 1982, during which the Mexican government threatened to default on its international debt, was the event that triggered widespread public attention to the debt crisis. Some of the first transnational expressions of concern about the impact of government debt on the poor came earlier, however, in the late 1970s, as U.S. and European missionaries working in debtor countries returned to their home countries and urged churches and NGOs to take up the issue. Many activists had experienced firsthand the devastating effect of the crisis on their parishioners and friends in debtor country shantytowns, and had been deeply imbued with the injunction of Latin American liberation theology to examine and confront "sinful structures" that contribute to poverty. Thus, arguments made by the U.S.-based Debt Crisis Network and its counterparts in Europe emphasized moral outrage at the debt overhang's implications for the poor as well as the degree to which it eviscerated efforts to tackle poverty. For example, Rev. Thomas Burns, a Maryknoll priest who has worked in a shantytown outside Lima for over twenty-five years, put it succinctly in his March 1987 testimony to the U.S. Congress: He was baptizing more dead babies since the institution of IMF-imposed structural adjustment in Peru. (4)
In England, Oxfam activists launched a successful media campaign, DATAA, in 1984 to educate people on the "five forces" that connected Britain with world hunger, focusing on one theme each year: debt, aid "(not enough and of the wrong type), trade (scales weighted against poorer countries), agriculture (European Community policies on surplus production and of manipulated world markets), and arms (the extravagant trade in weapons). Oxfam's 1986 campaign focused on debt. Coming on the heels of the 1985 Live Aid concert, which had generated attention to and monies for famine relief, Oxfam pointed out that for every dollar of emergency aid given to the African relief effort, about two dollars was paid to the West by the poorest twenty-nine African countries in debt repayments. (5)
The mid to late 1980s saw the leadership of many Catholic and Protestant national church bodies and the World Council of Churches draft statements evaluating the ethics of the debt crisis. Several of Latin America's national Catholic bishops' conferences issued statements condemning the disproportionate burden that economic adjustment policies placed on the poor of their countries. (6) In their 1986 major pastoral letter on the U.S. economy, the U.S. Catholic bishops joined their Latin American counterparts in deploring the social impact of the debt crisis, and advocated a two-tier solution: longer repayment periods, lower interest rates, and modification of IMF adjustment requirements for middleincome debtors; and extensive debt cancellation for the poorest, chiefly subSaharan African countries. (7) The U.S. bishops followed up their 1986 letter with congressional testimony on developing country debt by the chairman of the economics pastoral drafting committee (8) and by a principal advisor to the episcopal conference on international issues. (9) The U.S. bishops also established a subcommittee, which, after consulting with leading government, multilateral, and commercial bank officials, drafted an in-depth statement in 1989 updating and expanding the bishops' previous analysis. (10)
Other national bishops' conferences in creditor countries also took up the issue. For example, the German Catholic bishops issued a detailed statement on the social impact of the debt crisis. (11) In addition, together with the Evangelical Church in Germany, they issued a joint statement and presented testimony before the German parliament, bringing together a Protestant biblical analysis of the jubilee theme and the Catholic common good tradition. (12)
The highest level of the Catholic Church supported this outpouring of local and national religious engagement on debt crises. Pope John Paul II repeatedly raised the debt issue on his many trips to both creditor and debtor countries, in his public sermons, in talks with officials representing national governments, international organizations, commercial banks, and local churches, and in two of his encyclicals, "Sollicitudo Rei Socialis" (1987) and "Centesimus Annus" (1991). Because of his office, personal charisma, and well-covered activism on East-West and North-South relations, he drew the most media attention to the issue from the mid-1980s through the late 1990s. At the pope's request, in 1987 the Pontifical Commission for Justice and Peace, the Vatican's think tank on international development questions, issued a more explicit examination of the ethical dimensions of the debt. (13) The commission's president, Cardinal Roger Etchegaray, traveled to Washington to discuss the statement's recommendations with top officials of the World Bank and the IMF.
THE VATICAN AND U.S. BISHOPS' STATEMENTS
By the second half of the 1980s, the debt crises in developing countries were on the agenda for discussion in Catholic churches around the world and in Church officials' dialogues with key policy-makers. It is worth looking in more detail at the 1987 Vatican statement and at one of the national bishops' statements, the 1989 U.S. bishops' statement, as they arguably had an impact on the thinking of the leadership of several major U.S.-based banks, the U.S. government, and international financial institutions based in the United States, the IMF, the World Bank, and the Inter-American Development Bank (IDB). For example, extensive interviews in the early 1990s with the top leadership of the IMF, including past and present managing directors and deputy managing directors, and major country executive directors, revealed that they were most conversant with these two statements. IMF Managing Director Michel Camdessus, a practicing Catholic and longtime close friend of Cardinal Etchegaray, had been asked to review and comment on drafts of the Vatican's 1987 statement, as had his predecessor, Jacques de Larosiere. (14) A comparison of the two statements reveals that the U.S. bishops, addressing more particularly their country's role in the crises, were slightly more critical of major public- and private-sector actors than was the Vatican, and made a stronger case for the need for structural change in the international economy.
The Authority of the Two Statements
The Pontifical Council (formally Commission) for Justice and Peace (PCJP), an advisory body that grew out of the social justice concerns of the Second Vatican Council in the 1960s, prepared the Vatican statement. The PCJP is a standing committee whose members and "consultors" are appointed by the pope to study matters bearing on justice, peace, and human rights. It collaborates with others within the Catholic Church, as well as with the academic and intellectual world, and other religions and secular organizations. Among other concerns, the council "promotes ethical reflection on the evolution of economic and financial systems." It formulates ethical principles and guidelines in the areas it examines, drawing on the Church's social teachings, with a view to spreading knowledge of those teachings. (15) While officially the PCIP advises the pope, it effectively serves as a means to open discussion within the global Church, giving visibility and urgency to issues on which the Vatican expresses concern.
To address the complex issue of sovereign indebtedness, to which Catholic development and relief agencies, bishops, and missionaries, among others, had been seeking greater Church attention, the PC]P departed from usual practice by drawing heavily on the work of laypeople, namely a group of European Catholic bankers and international organization personnel who had been meeting for ethical reflection in Paris. The PCJP leadership integrated much of a 1985 report the group had drafted into the Vatican statement. This explains the fairly detailed and technical policy language unusual for Vatican documents. (16) The debt statement provided continuity with previous Vatican statements in its broad tone at the level of principle, and its moderate analysis and recommendations.
The text draws almost exclusively on papal and curial teaching. (17) The statement does not review biblical themes that might shed light on the issue of indebtedness. The entire document makes only two references to the New Testament, both in the form of ancillary recommendations implying that a Gospel-based ethic would require a more radical approach than the principal one suggested by the document. (18) The statement's drafters are less explicit as to the sources drawn upon for its policy analysis and recommendations, other than to mention that the text "has made use of many studies on the international debt that have already appeared," (19)
The second influential statement was drafted by the U.S. Conference of Catholic Bishops (USCCB), a coordinating body of the Catholic Church in the United States. Originally established by the U.S. bishops in 1919 as the National Catholic Welfare Council to work for peace and social justice after World War I, the USCCB, like similar bishops' conferences in other countries, now organizes and carries out a wide range of religious, charitable, educational, and social welfare work. The USCCB is intentionally called a "conference" to emphasize that it is a consultative rather than legislative body. In this regard, when it takes positions through statements, they are meant to be teachings of the U.S. bishops collectively; it is up to individual bishops to decide whether they want to take action on those declarations. The USCCB largely works through some fifty committees that focus on different specific issues, one of which is the Department of Social Development and World Peace. This committee developed the 1989 statement on developing country debt and others that were subsequently issued. (20)
The U.S. bishops' statement on debt, issued two years after the Vatican statement, reflected continuity with earlier USCCB statements, such as the 1983 war and peace pastoral (21) and the 1986 economic pastoral, in drawing upon a multiplicity of sources, following an explicitly consultative methodology, and acknowledging a plurality of views within the U.S. church. The sources include the Bible, papal speeches and encyclicals, the PCJP statement, the 1971 Catholic bishops' synod on justice in the world, their own 1986 economic pastoral letter, the 1989 UNICEF annual report, comments from debtor country bishops and the UN secretary-general, and World Bank studies. Reflecting their consultative approach, the U.S. bishops explain that they chose to write the letter partially in response to the requests of their fellow bishops in developing countries and U.S. missionaries working there. They also consulted "chief executives of U.S. banks, officials of government and international financial institutions, leaders of developing countries, theologians and other experts and policy makers." (22) Furthermore, in a departure from tradition, the subcommittee formed in 1988 to explore the debt question was composed of just one bishop and three laymen. At the time the latter three were senior executives of social science institutes or foundations; one was a former banker and one a former congressman.
Finally, the U.S. bishops were willing to acknowledge and publicize the fact that different views existed within the Church as to an ethical assessment of the debt crisis. The U.S. bishops only partially distinguish themselves from more radical views, mirroring the process and resulting document of the U.S. bishops' 1983 war and peace pastoral, in which they adopted a just war framework but also put forth the pacifist critique of their positions.
Ethical Perceptions and Principles
The PCJP statement declares that the church "hopes to enlighten the moral conscience of the decision makers, but she does so without proposing action programs which would be outside her field of competence." (23) Nevertheless, three-quarters of the statement proceeds to offer moderately detailed short-, medium-, and long-term policy recommendations to the four sets of actors it identifies as coresponsible for both the crisis and its resolution: creditor country governments, debtor country governments, public- and private-sector creditors, and multilateral financial organizations.
The ethical motivation for the PCJP statement is expressed succinctly. The body of the text refers to the "serious, urgent and complex" nature of the crisis due to its impact on living conditions, development, and the international financial system. The most explicit and strongest moral concern, however, was offered in the introductory presentation made by Cardinal Etchegaray and Archbishop Jorge Mejia, the PCJP president and vice president, respectively, when the statement was released: "Debt servicing cannot be met at the price of the asphyxiation of a country's economy, and no government can morally demand of its people privations incompatible with human dignity." (24)
These ethical judgments led the PCJP to formulate six ethical principles, broadly cast as general rules to guide the relevant parties' response to the crisis: create new norms of solidarity; accept co-responsibility; establish relations of trust; know how to share efforts and sacrifices; foster the participation of all; and identify emergency and long-term measures.
The U.S. bishops' letter is approximately the same length as that of the Vatican, but is differently weighted. A third of the document is devoted to a much more detailed discussion of the crisis, with greater focus on the United States' role in its origins and management. (25) The bishops also seek to "put a human face on the reality and injustice hidden by the figures, the reports and the proposals what the Latin American bishops described to us as 'an iron ring around the necks of our people.'" (26) The statement reviews the causes and the evolution of the crisis and proposed current solutions to it, suggesting that few of the latter "address the basic concern of social justice: Why should the poor in debtor countries, who had nothing to say about accruing the debt and have received little or no benefit from it, have to bear the greater burden of its payment?" (27) The bishops determine that the debt problem, "with its human consequences, is economically unsound, politically dangerous and ethically unacceptable." (28)
The bishops then take up more radical ethical arguments made by "many advocates, especially in the religious community," who consider the debt, "in the aggregate," to be unjust. According to this line of argument: first, even though there may have been a contract in the beginning, the debt has increased and become more burdensome over time in ways that were unforeseeable; second, the debt was accrued without participation by or benefit to the poor who suffer most from the austerity measures imposed to service it; third, it has been paid already many times over through the unusually high interest rates; fourth, most of the renewed borrowing, beyond the initial loans, has been undertaken almost entirely to service the debt, rather than for genuine development; and finally, a considerable part of the borrowed funds was expended on dangerous and wasteful armaments or on programs benefiting the elites. In some cases it was simply returned to the industrialized world in the form of foreign investment what has come to be called flight capital. (29)
In more detail, they cite the arguments made by "many voices in the church" who make a moral claim that the debt should not be paid. The U.S. bishops agree that "in terms of social justice" such a case "may be possible to make," and yet they also posit that "a moral presumption exists in personal and social relations that debts should be paid." The bishops believe, however, that this presumption "must be tested against a further series of questions" regarding the justice of the contractual arrangements between developing country governments and their creditors. These include the legitimacy of the governments that contracted the original debts (some having come to power through military coups or fraudulent elections), the record of what has been paid to date in debt service at high interest rates, and the internal social costs borne by debtor countries in servicing their debts. The bishops conclude that given the variety of situations, both "the nature of the original agreements and the attempts of some debtors to repay them lead us to the conviction that no single principle can govern all the different situations of indebtedness." (30)
In short, while the bishops do not endorse the radical view, neither do they definitively disassociate themselves from its conclusion: "One does not, however, need to accept the argument that the debt is illegitimate to urge that there be relief from payment or even forgiveness in whole or in part, in order to lessen the suffering of those most vulnerable to the effects of the debt burden." (31)
The bishops make this alternative case for relief by reviewing pertinent themes from Catholic social teaching, the Vatican debt statement, and earlier papal teaching, and they also integrate biblical themes, such as the treatment of the most vulnerable (widows and orphans) as a measure of the moral character of the early Hebrew community, the Jewish institution of the jubilee year, and Jesus' use of stories about debtors treated mercifully as being revelatory of the quality of God's love and how people should treat each other. The bishops explicitly acknowledge that such images "do not provide either a formula for addressing the complexity of international debts or even clear principles for adjudicating a fair resolution of this major institutional question." Biblical themes, rather, "provide a starting point, a way to understand creditor-debtor relations, which a purely empirical assessment of the debt problem will never offer." (32)
This brings them to emphasize human rights as well as needs. The biblical images suggest, they argue, that "those who are in debt retain their dignity as well as their basic human rights, which make demands upon creditors; debtors cannot be reduced to a situation of abject poverty in order to pay debts." (33) They imply that respect for the human rights of the poor entails meeting their basic human needs, in accordance with the integration of social and economic as well as political and civil rights in Catholic notions of human rights.
In short, one may say that alleviating extreme poverty drives their central statement of principle, which they then affirm:
We believe that in many instances the presumptive obligation to repay should be overridden or modified because of the social costs imposed on the poor. When the social costs erode personal dignity, causing hunger, homelessness, sickness and death, the principles of justice point not toward repayment by the debtors, but toward remission, even if partial, by creditors. Remission in complex cases like this does not mean "forgiveness" for all states. A range of remedies is possible and necessary; a scale of redress is needed to judge different situations. At times partial forgiveness will be a fair response, as we noted in "Economic Justice for All," or at times renegotiation or partial rescheduling. (34)
The bishops then offer eight "criteria on how the principles of justice, solidarity and the common good can be used in contributing to the resolution of Third World debts." (35) They advocate solutions to the crisis that promote the participation of the poor in the economy and respect for human rights, an equitable sharing of responsibility, attention to external factors beyond the control of debtor countries, and the ability of debtor countries to pursue "independent, self-reliant, participatory, sustainable development." (36)
Different Policy Recommendations
The PCJP offers relatively extensive policy recommendations, which it divides into immediate emergency measures for those countries unable to meet their payments and whose populations are particularly suffering, and medium- and long-term "adjustment measures" organized according to the four groups of actors previously cited. It offers two main recommendations for short-term measures. First, in what the PCJP terms an "ethics of survival," it urges that the parties "foster dialogue and cooperation," "avoid payment defaults which could destabilize the international financial system," and "avoid breaches between creditors and debtors as well as any unilateral termination of prior commitments; respect the insolvent debtor and do not burden him with immediate and intolerable demands which he cannot meet." It recommends that the parties consider other avenues, such as debt rescheduling and partial or even total remission, "with the Gospel as the source of inspiration." (37) Second, the PCJP suggests that "coordinating structures" be set up as quickly as possible "to foresee, prevent and attenuate such crises." They suggest that the IMF is particularly well suited to lead the design of such measures. It is also in this context, however, that the statement offers its most stinging criticism of IMF-imposed adjustment policies: "In numerous cases, however, the IMF's decisions have been ill-received by the leaders and the general public of countries in difficulty; the decisions in question may seem to have been imposed in an authoritarian and technocratic way without due consideration for urgent social requirements and the specific features of each situation. It would be advisable to bring out clearly that dialogue and service of all concerned are values which guide the actions taken by the IMF." (38) This quotation was most often cited, with bitterness, by some of the people interviewed by the author at the Fund.
The PCJP urges industrialized country and developing country governments, creditors (states, commercial banks, and multinational companies), and multilateral financial organizations to play an active role in international efforts to address the crisis. Policies advocated include not only debt rescheduling and the resumption of lending, but also measures to bring down high interest rates, combat protectionism and erratic exchange rate fluctuations, and increase investment and aid monies for the debtors. The multilateral financial organizations should, among other things, "acknowledge the need to increase the representation of developing countries and their participation in the major international economic decisions that affect them," tailor loan conditions more carefully to each country, and "foster dialogue between creditors and debtors for a rescheduling of debts and a reduction of the sums due in one or even more years if possible." (39)
The USCC policy recommendations to international actors are much briefer, and focus more pointedly on the need for negotiations of fundamental changes in the structure of the international economic system on a par with those preceding the establishment of the Bretton Woods system, this time with greater developing country participation. (40) The remaining recommendations are geared toward U.S. actors. The statement urges the executive and legislative branches to act on the intention, announced by President George H. W. Bush in July 1989, to forgive bilateral sub-Saharan African debt, and to modify banking regulations in order to encourage commercial banks to pursue debt reduction. It also appeals for U.S. leadership in the IMF and the World Bank in favor of "policies less tied to the highly questionable development model of structural adjustment," with "genuine flexibility and a case-by-case approach" versus the "rigid and uniform conditionality to which the IMF and the World Bank seemed in fact to be committed," and for action by commercial bankers toward "effective debt relief, which can include at least partial forgiveness of debt" as a matter of "obligatory," "realistic" justice rather than charity. (41)
It is hard not to see the USCC recommendations as bolder than those that emerged from the PCJP. The PCJP may be thought of as legitimating breaking the ground that the USCC later plowed. Also, the imperative to call for strong measures was more pressing after two additional years of unresolved debt crisis. The growing voices in global civil society calling for radical reforms were also better heard by 1989. Indeed, in addressing those views, the U.S. bishops were led to a more explicit questioning of the morality of the outstanding debt itself, and to a stronger call for extensive debt forgiveness and efforts to restructure "an international economic system that is becoming increasingly unworkable and inequitable." (42)
TOWARD JUBILEE 2000
Network activists continued throughout the 1990s to press for further bilateral and multilateral debt reduction. They welcomed incremental improvements in creditor country policies customarily announced at annual summits of the major powers, but they also offered detailed analysis of shortcomings and demanded further action. The decade also saw a marked improvement in the capacity of civil society groups in debtor countries to document the impact of the debt overhang on the poor and press for cancellation. Zambia provides a good case in point.
A View from the South: Zambia's Churches
If Latin American Catholic churches drove the major involvement of the global Church in international debt policy in the 1980s, the focus in the 1990s turned to Africa. In some sub-Saharan countries, a strong civil society movement emerged, with Catholic and other churches at the center. In the case of Zambia, the Catholic Episcopal Conference joined with the other two national church bodies--the Christian Council of Zambia (mainline Protestant) and the Evangelical Fellowship of Zambia (evangelical Protestant)--to issue a joint pastoral letter in August 1998 to much local publicity. It states:
Zambia's total debt is clearly unpayable. Zambia cannot pay back because the debt burden is economically exhausting. It blocks future development. Zambia will not pay back because the debt burden is politically destabilizing. It threatens social harmony. Zambia should not pay back because the debt burden is ethically unacceptable. It hurts the poorest in our midst. (43)
The Jubilee Zambia campaign noted at the time that the country owed more than $6.5 billion, more than $650 for every Zambian. During the 1990s, the country paid out approximately 20 percent of GDP in debt service, but budgeted only 2-3 percent of GDP for health and education. (44) The gross inadequacy of the education budget was starkly indicated by the fact that in the late 1990s it was more likely for a Zambian teenager to be illiterate than for a Zambian between the ages of thirty and thirty-five. (45)
As to the origin of Zambia's excessive debt, the director of the Jesuit Centre for Theological Reflection in Lusaka, which hosts the Zambian Jubilee 2000 campaign, Dr. Peter Henriot, S.J., has cited "minor" and "major" causes. The minor causes in his view are poor management of the economy, including corruption, especially in recent years. The major causes are a chronic trade imbalance caused by generally weak prices of copper, the principal export commodity, and high prices for needed oil imports, coupled with the consequences of irresponsible lending by creditors, high interest rates caused by industrialized countries' macroeconomic policies, and exacerbation of economic decline and social hardship due to the conditionalities imposed under SAPs. (46) Campaigners also have charged that the structural economic reforms adopted by Zambia beginning in 1992 were dogmatically imposed by the World Bank and the IMF with great hardship: "Privatization of para-statals proceeded with harsh impact on employees; trade liberalization opened borders and closed industries; budget cuts meant rising fees for education and health, and declining enrollment and services." (47) In addition, Henriot has pointed out a special factor in the case of Zambia that further questions the notion that its government should be held responsible for the debt: a substantial portion of the external debt can be attributed to the moral position taken by President Kenneth Kaunda not to cooperate with apartheid in South Africa. As a consequence of that decision, economic disruption and dislocation due to border closings, destruction of infrastructure, and the inescapable need to host refugees forced Zambia to borrow heavily in the 1970s. (48)
In addition to calling for debt cancellation, Jubilee Zambia was sensitive to the need for civil society involvement with the government so that freed funds would be spent wisely and ethically. They thus campaigned vigorously for a transparent, accountable, and participatory process of allocating debt relief resources and contracting future debt--in effect, conditionality from below. In particular, the campaign has argued that Zambia should receive no debt cancellation unless the government puts into place an effective "debt mechanism." This mechanism, the campaign argued, should entail, first, accountable management of debt relief resources, so they actually are dedicated to poverty eradication. In this regard, the Zambian government formed a Heavily Indebted Poor Country (HIPC) Expenditure Monitoring Team in 2003 composed of representatives from several accounting and auditing groups and civil society groups, including Jubilee Zambia. Jubilee Zambia charged that the team was slow to organize and play an effective role, however. The campaign has proposed a tripartite committee of members of parliament, officials from relevant government ministries, and representatives of civil society groups to establish priorities in targeting HIPC funds and monitor their allocation and distribution. They suggest a social fund similar to that of Uganda's be established, in which debt relief resources would be placed to be distributed to poverty eradication programs in an accountable and transparent way. Second, the mechanism should entail transparent contraction of new debts, with clear priorities and limits, parliamentary approval and public awareness of large loans that the Minister of Finance and National Planning had instead been able to contract without consultation or approval of parliament. Again inspired by the limited success of the Ugandan parliament preventing the contraction of some questionable loans, the campaign has argued that the purpose and beneficiaries of a loan, conditions attached to it, and expectations of repayment should be subject to public scrutiny. (49)
A GLOBAL CAMPAIGN GATHERS MOMENTUM
During the second half of the 1990s, the debt cancellation movement grew increasingly global in scale and interaction, as coalitions like that in Zambia could exchange information more readily via the Internet. It gained fresh energy and impetus as the upcoming millennium provided a fixed goal for debt cancellation. British groups, led by the overseas relief agencies of the Anglican and Catholic churches, launched the Jubilee 2000 U.K. campaign in April 1996.
The campaign took the existing jubilee-inspired analysis that had infused previous campaigns, but provided new energy and coordination with the focus on the year 2000. According to Ann Pettifor, the seasoned and astute South African-born political organizer, who was hired to lead the staff, the original idea for the campaign came from Professor Martin Dent. He suggested that the most worthy way to celebrate the millennium would be to make substantial progress in improving the lot of the poor who bore the greatest burden of indebtedness, and that the most efficient way to do so would be to cancel their countries' debts; the year 2000 was targeted as the jubilee year. (50) U2's lead singer, Bono, who joined the campaign in 1998, perhaps argued this idea most colorfully:
The most inspiring thought I bumped into last year was the concept of Jubilee 2000, a call to cancel third world debts going into the next millennium and to give crippled nations a chance to get up off their knees and walk again.... Without a real commitment to do something about the dire circumstances of a third of the population of the planet, all new year's eve 99 will amount to is an up drawbridge scenario, a fancy dress ball at the castle where we all play Louis 14 pissing across a moat of champagne on the poor. (51)
The U.K. network was the first to establish the campaign's goal of a one-time cancellation of the unpayable debts of the world's poorest countries by the end of the year 2000; some sixty-nine national Jubilee 2000 networks were subsequently formed. (52) The movement took inspiration from and widely quoted the call of Pope John Paul II for debt relief in his 1994 statement on preparations for the next millennium, "Tertio Millennio Adveniente" (51): "Christians will have to raise their voice on behalf of all the poor of the world, proposing the Jubilee as an appropriate time to give thought ... to reducing substantially, if not canceling outright, the international debt which seriously threatens the future of many nations." (53)
The campaign used simple but powerful statistics to communicate both the scale of the crisis and the efficacy of debt cancellation for reducing poverty. For example, it cited that whereas the 1985 Live Aid concert raised $200 million for Africa, this is also the sum that Africa pays each week in debt service; that, spread over twenty years, the cost of canceling the debts of the fifty-two Jubilee countries is only one penny a day for each person in the industrialized countries; and that canceling the debt could save the lives of 7 million children a year. (54) In making its case, the Jubilee 2000 U.K. campaign drew a parallel between the debt crisis and the Atlantic slave trade: "It, too, was a system of international oppression, accepted for generations as a normal and necessary part of trade and life. And it, too, resulted in the West benefiting from the resources of the southern hemisphere while southern countries, and particularly sub-Saharan Africa, were devastated." (55) And, just as it took the concerted effort of thousands of ordinary people to abolish the slave trade, so too would it require the mobilization of many to convince creditor governments to cancel the debt: "Justice demands that richer countries give up unfair privileges, held at the expense of the poor. If creditors agree to remission of debts, the removal of a restraint on growth could allow poor countries to compete on fairer terms and reduce their dependence on the rich parts of the world." (56)
The increasingly global Jubilee campaign thus continued the efforts of its predecessor organizations in pressing for total debt cancellation while also critiquing the specific initiatives of creditor governments and the multilateral institutions, pushing for further reforms.
In fact, a consensus was forming among creditor authorities that the debt crisis in the poorest countries had gone on long enough. In September 1996, the leadership of the World Bank and the IMF launched the HIPC Initiative, the first comprehensive plan to reduce the debt of qualifying poor countries to "sustainable" levels through additional reductions in bilateral government debt and--for the first time--reductions in debt owed to multilateral institutions. While the overwhelming majority of the forty-one countries that potentially qualified in 1999 for HIPC debt relief were in sub-Saharan Africa, they also included Bolivia, Guyana, Honduras, and Nicaragua. By mid-1999, however, only four of the HIPC countries had advanced to a point in the review process at which they actually received debt relief. Campaigners pushed for deeper, broader, and faster debt reduction.
CONTINUING CATHOLIC CHURCH ACTIVISM ON DEBT
The Catholic Church made a number of crucial contributions to the Jubilee 2000 campaign. One way was through its access to key Catholic policy-makers, such as IMF Managing Director Michel Camdessus. This was significant, especially as the IMF had initially opposed the HIPC proposal, which the new president of the World Bank, James Wolfensohn, was championing. In addition, the Church hierarchy used its convening power to sponsor important conferences discussing the moral dimensions of debt, which arguably helped advance the HIPC Initiative as well as subsequent assessments of its shortcomings.
For example, on February 12, 1996, Cardinal Basil Hume of London hosted a private seminar on the ethics of multilateral debt reduction attended by church leaders from three continents, Camdessus and other senior executives of the IMF and the World Bank, senior politicians, academics, and journalists. In his welcoming address, Hume asserted two of the ethical principles that the Church believed to be applicable: "the need to acknowledge a co-responsibility for both the causes of, and the solutions to, the debt problem"; and that "there should be an equitable sharing of the adjustment efforts and necessary sacrifices, taking into account the priority to be given to the needs of the most deprived peoples." (57)
A second important example took place in October 1998, when shortcomings in the initial HIPC Initiative were increasingly being realized. Then, the PCJP, the U.S. Catholic Conference, and Seton Hall University cosponsored a major conference on the ethical dimensions of international debt, which drew over sixty leading officials from debtor and creditor country governments, multilateral institutions, NGOs, foundations, private-sector financial institutions, and universities. Participants included World Bank President James Wolfensohn, IMF Managing Director Michel Camdessus, and then Deputy Secretary of the U.S. Treasury Lawrence H. Summers. This was the first time that debt campaign leaders met collectively with such senior officials. The spirited and forthright discussion included an exchange of views on the morality of various dimensions of the debt issue, including the efficacy and appropriateness of different types of conditionality, which countries should receive debt cancellation, and the relative merits of debt relief versus other policies in achieving poverty reduction.