This summer I took a break from microcredit to return to my first love as an analyst in economic development, the Jubilee 2000 movement, which fought successfully for cancellation of the sovereign debts of the poorest nations.Just as when I set out to write chapter 3 of my microfinance book, I found myself drawn gravitationally into history. In this case, I became interested in how the idea first arose of making loans to governments of poor countries for purposes of economic development. Did the men who put the idea forward contemplate that it might be hard to collect on the debts? I ended up launching into a sort of analytical history of third world debt and debt relief---and running out of time before the September 29 event for which I committed to present a paper. So for that event I wrote a short, thematic essay with my take on the debt relief movement. I intend to return to the larger text after I finish my microcredit book.The third world debt cancellation campaign bears many similarities to the microfinance movement. Both movements overpromised, and both, perhaps only as a result, got some good done. In the case of the Jubilee 2000, campaigners claimed that erasing the debts of the poorest nations would save the lives of 19,000 children per year. But on this issue I am very much a Cohen-head, which is to say, persuaded by the work of Daniel Cohen that the poor, heavily indebted poor countries (most of which were in Africa) were effectively bankrupt. And forgiving the debts of a bankrupt neither costs the creditor much nor puts much money in the pockets of the debtor. Withal, bad debts ought to be written off, and the Jubilee campaign deserves credit for making that happen.On the other hand, there is a stark contrast in the core narratives of the two movements: macrodebt is bad and microdebt is good.It was something to be in the room on September 29 with the old warriors from all sides. There were Jamie Drummond, Bono's right-hand-man in public activism; William Scheurch, formerly of the U.S. Treasury; and Axel van Trotsenberg, who ran the debt cancellation unit at the World Bank. It reminded me of gatherings of veterans from both sides of the Vietnam war, and the time Bill Clinton and Newt Gingrich joined on TV to talk about old times. Then, the fight divided them; now it unites them.You can view:
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