On Sat, Aug 25, 2001 at 12:57:35PM -0400, Mike Lorrey wrote:
[ masses snipped; let's cut to the chase ]
> > > The purpose of the 19% loan is to send a price signal to the rulers that
> > > they can no longer fix today's problems by borrowing from the future.
> >
> > Nope, the purpose of the 19% loan is to send a diplomatic signal to the
> > rulers saying "we've got you where we want you, now lube up and bend
> > over". The 19% interest rate wasn't dictated for commercial reasons, but
> > for political ones.
>
> For political reasons like "You folks are not going to get out of this
> mess by borrowing your way out, you've got to work for it." Nobody ever
> found their way out of bankruptcy by borrowing more money.
Mike, I do not believe that the IMF and the World Bank -- or the G8 --
are interested in giving third world countries _any_ opportunity to get
out of the mess they're in. Doesn't matter whether they try to borrow
their way out, nationalize their way out, or work like maniacs; the
whole idea that there _is_ a way out is the problem. Because the system
works better for the rich nations if there is _no_ way out.
Healthy wealthy countries that have bootstrapped themselves out of
poverty aren't viewed as trading partners, but as competitors. And that's
the heart of the problem.
> >
> > > > Thirdly -- and this is the most important point -- conditions attached to
> > > > the loans are being used as instruments of state power. That is the
> > > > real bad problem here; the recipient of the loan isn't free to use it
> > > > productively.
> > >
> > > No, they are not free to spend it on social welfare programs. There is
> > > nothing wrong with a person to attach stipulations on how THEIR money is
> > > going to be used by those they lend it to. A bank would get mighty
> > > pissed if I took out an auto loan and used the money on a vacation to
> > > Fiji.
> >
> > Social welfare programs include building schools and training workers
> > in new skills. (What was that you said about "unskilled, unemployable,
> > and unwilling to fix that"?)
>
> Education isn't social welfare, public education is simply monopolism.
That's bollocks, Mike. And it isn't true, either. Education is useful to
individuals whatever the source, and educated individuals tend to benefit
the society they live in by virtue of their enhanced ability to work. In
a poverty-stricken country, people simply can't afford to pay for their
children to receive a private education; therefore the model of the state
paying for it seems to be the only viable one -- at least _somebody_ is
paying for it. But state funded education is treated as social welfare
by the IMF and world bank ...
-- Charlie
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