We Forgive Our Debtors
Do you owe any money? Do you carry a balance on your credit cards?
Do you have a car loan or home mortgage? Did you take out a loan for
college or to start your business? Do you worry that your children
Reasonable debt is
fine. Borrowing and paying back with interest is an integral part
of capitalism. It's the growth spur to the economyon personal,
corporate and governmental levels.
But crushing debt is
terrible; it can drive individuals to suicide. Some of the first European
settlers came to the United States to avoid debtors' prisons or indentured
servant status, often inherited from their fathers. For this reason,
the United States developed compassionate bankruptcy laws.
On the international
level, however, debt is out of control. The total external debt of
the developing countries is more than $2 trillion, according
to the April 1999 statement of the Administrative Board of the U.S.
Catholic Conference, A Jubilee Call for Debt Forgiveness. The
debt of the 41 poorest countries is more than $200 billion, a tenth
of the total.
The problem is that
"these impoverished nations spend four times more repaying their debts
than on investing in health, education, sanitation and other basic
needs," says Barbara Kohnen, U.S. bishops' policy adviser on international
So these poorest countries
are appealing to the United States and other nations for debt relief.
In his plan for celebrating
the new millennium, Pope John Paul II has identified international
debt relief as a key priority for the Church (Tertio Millennio,
At the Synod for America
the bishops of Latin America pointed out that their countries have
paid the United States the principal they borrowed but, with interest
compounding, now owe more than they did originally. In 1970 they owed
$70 billion and by 2000 they will owe $700 billion; they have already
paid back $720 billion.
What is being proposed
by an international group called Jubilee 2000 Coalition is cancellation
of four types of debt: unpayable debt and debt which cannot be repaid
without burdening already impoverished people, debt that in real terms
has already been paid, debt on improperly designed policies and projects
and odious debt incurred by repressive regimes.
If such debts are canceled,
who will not be getting paid? In practical terms, it is the American
taxpayers who will not receive the benefit of interest.
In retrospect, many
of these loans should have been issued not as loans at all but as
foreign aid, where more restrictions could have been imposed.
Solutions Endanger Future
Governments raise the
money to service their debts by short-term solutions: cutting social
services like health and education, laying off workers and reducing
wages, privatizing industries, delaying necessary development and
The new U.S. bishops'
board statement gives examples of what crushing debt repayment means
in specific countries, such as Mozambique where, in 1998, the "annual
debt service obligation was more than half of its public revenue.
In a country still emerging from a 16-year civil war, half the rural
population does not have access to safe drinking water; 200,000 children
die annually from preventable diseases such as malaria, measles and
respiratory infections; two thirds of adults are illiterate; and most
children do not go to primary school."
Besides the moral imperative,
there are a number of reasons why we should support debt-relief measures:
These debts are unlikely to be paid back anyway; if not alleviated,
the current crisis contains the seeds of World War III; debt relief
would create viable trading partners in the future.
Forgiving the debt
would not be a new policy for the United States. In recent years we
reduced debts owed by Poland, Jordan and Egypt.
President Bill Clinton's
new proposal for relieving the debt burden of the world's poorest
countries garnered high praise from the bishop-chairmen of the U.S.
Catholic Conference's International Policy Committee and Catholic
The ecumenical organization
Bread for the World contends that debt reduction would reduce hunger
worldwide. To that end, they are asking for an "Offering of Letters"
in support of the U.S. House Resolution 1095, also known as the "Debt
Relief for Poverty Reduction Act." Introduced March 11, this bill
was developed with Catholic and other religious organizations. Each
of us can write our representatives and senators in support of H.R.
The pope had based
his plea for debt relief as an appropriate way to celebrate the new
millennium by recalling the concept of jubilee in Leviticus 25:8-12:
Every 50 years, we should let the land rest, free captives, forgive
debtors. In the jubilee year of 2000, which so obviously recalls Jesus'
birth, it's important to recall Jesus' mission: to bring glad tidings
to the poor, proclaim liberty to captives and announce a year of favor
from the Lord (see Luke 4). Debt reduction could be our way of sharing
in Jesus' mission.
After all, it was Jesus
who taught us to pray, "Forgive us our trespasses as we forgive those
who trespass against us." The phrase those who trespass against
us is often translated debtorsan apt reminder of the