[Comrade Ogilvy]

What is Bush's position on debt relief? Has he ever publicly stated that he's in favour of (or opposed) it?

[Comrade Ogilvy]

I am 100% positive that Bush is opposed to third world debt relief, as he well should be. These debts were contracted in good faith. They were not grants, and they should be repaid.

[Batko]

Mmmh... I hardly believe the game is as "fair" as Uncle Sam's pretend it to be, personnally...

Uncle Sam has reneged and defaulted on up to 40% of its trillion-dollar foreign debt, and nobody has said a word except for a line in The Economist. In plain English that means Uncle Sam runs a worldwide confidence racket with his self-made dollar based on the confidence that he has elicited and received from others around the world, and he is a also a deadbeat in that he does not honor and return the money he has received.

How much of our dollar stake we have lost depends on how much we originally paid for it. Uncle Sam let his dollar fall, or rather through his deliberate political economic policies drove it down, by 40%, from 80 cents to the euro to 133 cents. The dollar is down by a similar factor against the yen, yuan and other currencies. And it is still declining, indeed is apt to plummet altogether.

There was also a spate of competitive devaluations in the 1930s, called the "beggar thy neighbor policy" of shifting the costs for the neighbors to bear. True, as the dollar has declined, so has the real value that foreigners pay to service their debt to Uncle Sam. But that works only if they can themselves earn in currencies that have increased in value against the dollar. Otherwise, foreigners earn and pay in the same devalued dollars, and even then with some loss from devaluation between the time they got their dollars and the time they repay them to Uncle Sam. China and other East Asian nations do earn in dollars, to which they have pegged their currencies, so they have already lost a substantial portion of their dollar stake, by far the world's largest.

And they, like all others, will also lose the rest. For Uncle Sam's debt to the rest of the world already amounts to more than a third of his annual domestic production and is still growing. That alone already makes his debt economically and politically never repayable, even if he wanted to, which he does not. Uncle Sam's domestic, eg credit-card, debt is almost 100% of gross domestic product (GDP) and consumption, including that from China. Uncle Sam's federal debt is now US$7.5 trillion, of which all but $1 trillion was built up in the past three decades, the last $2 trillion in the past eight years, and the last $1 trillion in the past two years. Alas, that costs more than $300 billion a year in interest, compared with, for example, the $15 billion spent annually on the National Aeronautics and Space Administration (NASA). But no worries: Congress just raised the debt ceiling to $8.2 trillion. To help us visualize, $1 trillion tightly packed up in $1,000 bills would create a pile 100km high.

But nearly half is owed to foreigners. All Uncle Sam's debt, including private household consumer credit-card, mortgage etc debt of about $10 trillion, plus corporate and financial, with options, derivatives and the like, and state and local government debt comes to an unvisualizable, indeed unimaginable, $37 trillion, which is nearly four times Uncle Sam's GDP. Only some of that can be managed domestically, but with dangerous limitations for Uncle Sam noted below. That is only one reason I want you to meet Uncle Sam, the deadbeat confidence man, who may remind you of the film Meet Joe Black; for as we get to know him better below, we will find that he is also a Shylock, and a corrupt one at that.

The United States is the world's most privileged nation for having the monopoly privilege of printing the world's reserve currency at will and at a cost of nothing but the paper and ink it is printed on. Moreover, by doing so, Uncle Sam can export abroad the inflation he generates by the extra dollars he prints, of which there are already at least three times as many floating around the world as at Uncle Sam's home. Additionally, his is also the only country whose "foreign" debt is mostly denominated in his own world-currency dollars that he can print at will; while most foreigners' debt is also denominated in the same dollar, but they have to buy it from Uncle Sam with their own currency and real goods. So he simply pays the Chinese and others in essence with these dollars that already to begin with have no real worth beyond their paper and ink. So especially poor China gives away for nothing at all to rich Uncle Sam hundreds of billions of dollars' worth of real goods produced at home and consumed by Uncle Sam. Then China turns around and trades these same paper dollar bills in for more of Uncle Sam's paper called Treasury Certificate bonds, which are even more worthless, except that they pay a percent of interest. For as we already noted, they will never be able to be cashed in and redeemed in full or even in part, and anyway have the lost much of their value to Uncle Sam already.

http://www.politicsforum.org/forum/viewtopic.php?t=37734&sid=50f72a170abf4e0b15c82f02f7c2680b

[Comrade Ogilvy]

Why should they be repaid?

Surely this is an issue of compassion. Less debt for a third world country means more money for them to fund their own services.

A libertarian US government wouldn't have given them loans (or grants) in the first place!

[catquas]

Here is something about Bush agreeing to debt relief. http://www.guardian.co.uk/debt/Story/0, ... 80,00.html

One interesting thing related to this is that the Bush administration is in favor of having the IMF rely less on loans and more on grants.

[newbtard]

Clearly a lot of these countries are being crushed by the high debt that they are not going to be paying back anytime soon. Ive heard a lot about forgiving the debt of many third world countries and hopefully Bush will be for that, because economic prosperity will bring freedom along with it. The Middle East would be a much better world if their economies werent simply oil or bust.

The interest spent on debt could be invested in infrastructure improvement so that they could handle foreign investment to create jobs and create a vibrant growing economy in these countries.

[malachi151]

I am 100% positive that Bush is opposed to third world debt relief, as he well should be. These debts were contracted in good faith. They were not grants, and they should be repaid.

Ummmm... actually no.

The majority of debt to the US by third would countries was not taken out in "good faith" at all.

Most of it is debt that was taken on by puppet dictators during the Cold War, and used to build infrastructure at the direction of American multi-national corproations.

The way the system works you see is that the US would overthrow a governmetn in the 1960s, 70s, 80s, etc, put in a puppet military dictator and give him millions of dollars in "foreign" that he would then use to kill his own citizens and form a police state to oppress his people at the direction of the CIA.

Then the dictator would be instructed to take out loans from US lenders, the American government, the IMF and WorldBank.

The money from those loans would then be used to do things liek build deep water ports near natural resource reserves, railroads connecting mines and timber locations, logging roads and communications equipment needed for multi-national corporations to operate.

Then, one all of this infrastructure was built, at the expese of the small theird world country, under military rule by the US puppet, the multinational corporations come in and "harvest" all the resources at dirt cheap prices, paying the local workers less than a dollar a day in some cases, such that no real income was made on the "investments".

Meanwhile, the corporations make off with all the value and leave the third world country pennyless with no means to pay back its loan because all its most valued resources have already been squandered.

That is how the West has gotten rich you see. And that is why the third world is in debt you see.

THE LOANS WERE NEVER MADE IN GOOD FAITH!