William Mitchell — A debt jubilee is the only way low-income nations will escape the penury of debt distress (and the IMF/World Bank)

There is something deeply wrong with the world under Capitalism when the poorest countries in the world pay more out on debt servicing to loans that the wealthy countries have provided than they do on maintaining their health care services. I have been examining data derived from the World Bank WDI database and the IMF WEO database pertaining to the debt sustainability of the poorest nations in the world. Using 2019 data (most recent) 64 nations, for which coherent data is available, spend more on external debt services than they do on health care (Source). At the same time, the most recent assessment from the IMF and the World Bank, under their Debt Sustainability Program (DSA) shows that debt distress is rising fast across the low-income bloc of countries. The response of the multilateral institutions is to enter ‘agreements’ with these nations that impose fiscal austerity and enforce a range of changes such as privatisation, outsourcing and more. This strategy does not work and only serves to protect the assets of the rich countries and corporations. A debt jubilee is the only way low-income nations will escape the penury of debt distress and the austerity-obsessed clutches of the IMF and the World Bank.…

Bill joins Michael Hudson in calling for debt cancellation where onerous debt cannot be repaid since there is no reasonable path. Moreover, it is arguable that these debts were imposed as a result of (institutionalized) predatory lending and are therefore not legally enforceable. International institutions like the IMF and the World Bank are advertised as developmental when they operate as tools for continuing colonization. This is an aspect of predatory capitalism.

William Mitchell — Modern Monetary Theory
A debt jubilee is the only way low-income nations will escape the penury of debt distress (and the IMF/World Bank)
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia