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Making the Case for Jubilee: The Catholic Church and the Poor-Country Debt Movement

  • Elizabeth A. Donnelly
Abstract

Since the late 1970s, an increasingly global coalition of churches and nongovernmental organizations has pressed for reduction if not outright cancellation of the foreign debt of highly indebted poor countries, because of its deleterious impact on poor people. The movement achieved limited yet substantial success in the Jubilee 2000 campaign. In it, the movement invoked a biblical prescription of periodic debt relief to urge the international community to mark the millennium by recognizing a period of “jubilee” for heavily indebted poor countries, in which government debts would be cancelled and freed up resources used to alleviate poverty. The Catholic Church made a crucial contribution to the movement, through the involvement of its personnel, justice and peace offices, social service agencies, academic and research institutions, national bishops’ conferences, Vatican agencies, and Pope John Paul II. The essay traces the moral arguments the church made for debt relief, with a particular focus on two influential statements: those of the Vatican's Pontifical Justice and Peace Commission in 1987, and the U.S. Catholic bishops’ conference in 1989. By stimulating discussion of the ethics of debt among senior policymakers, the church's efforts strengthened the legitimacy of the claim that excessive debt servicing was unjust. Zambia is offered as a case study of church and coalition efforts to press not only for debt cancellation, but also for measures to ensure that freed-up resources be used effectively for poverty reduction, and that debtor governments contract new debt in a transparent manner.

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1 World Bank, “Partnership for Development: From Vision to Action” (Washington, D.C.: World Bank, 1998), p. 67.

2 For a history and assessment of the informal network of NGOs and churches that evolved into a more integrated but loosely affiliated coalition of groups collaborating on the Jubilee 2000 campaign, see Elizabeth A. Donnelly, “Proclaiming Jubilee: The Debt and Structural Adjustment Network,” in Sanjeev Khagram, James V. Riker, and Kathryn Sikkink, eds., Restructuring World Politics: Transnational Social Movements, Networks, and Norms (Minneapolis: University of Minnesota Press, 2002), pp. 155–80.

3 See CIDSE and Caritas Internationalis, “The Case for an International Fair and Transparent Arbitration Process,” Background Paper, September 2002; available at http:\\www.cidse.org/en/tg3/ftapfin.pdf.

4 “Impact of the Latin American Debt Crisis on the United States,” Subcommittee on International Debt, Committee on Finance, U.S. Senate, 100th Congress, 1st sess., March 9, 1987, D125.

5 John Clark, “A Grassroots View of the Debt Crisis,” Food Monitor 42 (Fall 1987), p. 11.

6 See, e.g., statements by the Mexican (1987) and Cuban (1986) Catholic bishops, reprinted in Edward Cleary, O.P., ed., Path from Puebla: Significant Documents of the Latin American Bishops since 1979, trans. Phillip Berryman (Washington, D.C.: U.S. Catholic Conference, 1989), pp. 330–48. Other Latin American bishops’ conferences issued short reflections on the debt crisis as part of more comprehensive statements on socioeconomic conditions in their countries. See, e.g., the statement by the Ecuadoran bishops (1986) in Cleary, Path from Puebla, pp. 210–20. Individual bishops, most notably Cardinal Paulo Evaristo Arns of Sao Paulo, Brazil, also spoke out on debt.

7 United States Catholic Bishops Conference, “Economic Justice for All: Catholic Social Teaching and the U.S. Economy,” Origins, NC Documentary Service (hereafter Origins) 16, no. 24 (November 27, 1986), p. 438.

8 Archbishop Rembert Weakland, O.S.B., “Viewing International Debt in Its Full Dimensions,” Origins 16, no. 41 (March 26, 1987), pp. 722–26.

9 J. Bryan Hehir, “Third World Debt and the Poor,” Origins 18, no. 36 (February 16, 1989), pp. 607–12.

10 Administrative Board of the United States Catholic Conference, “Statement on Relieving Third World Debt,” Origins 19, no. 19 (October 12, 1989), pp. 305–14.

11 World Church Commission of the German Bishops, “The International Debt Crisis: An Ethical Challenge. The Role of the Federal Republic of Germany” (Bonn: Secretariat of the German Bishops Conference, May 16, 1988).

12 Joint Conference on Church and Development (GKKE) of the German Commission for Justice and Peace of the German Catholic Bishops’ Conference and Church Development Service, an Association of Protestant Churches in Germany, “The International Debt Crisis Concerns Us All: Contributions to the Public Hearing of the Commission for Economic Development of the German Parliament,” GKKE 16 (September 1988).

13 Pontifical Commission for Justice and Peace, “An Ethical Approach to the International Debt Question,” Origins 16, no. 34 (February 5, 1987), pp. 601–11.

14 Interviews with Michel Camdessus, IMF Managing Director, July 2, 1992, and Jacques de Larosiere, Governor of the Bank of France, March 17, 1992.

16 Interviews with: Bernard Snoy, then Executive Director to the World Bank and IMF, July 2, 1992 (a founder of and participant in the Paris group); Rev. Philippe Laurent, S.J., March 13, 1992 (a social ethicist who served as the group's ecclesial advisor); Monsignor William F. Murphy, March 4, 1992 (former PCJP undersecretary); and Cardinal Roger Etchegaray, March 24, 1992 (then PCJP president).

17 The most oft-cited documents are Pope Paul VI's 1967 encyclical on development, “Populorum Progressio,” and the 1986 “Instruction on Christian Freedom and Liberation,” issued by the Vatican's Congregation for the Doctrine of the Faith.

18 PCJP, “An Ethical Approach,” pp. 605, 608.

19 Ibid., p. 604.

20 See United States Conference of Catholic Bishops at http:\\www.usccb.org/whoweare.shtml.

21 National Conference of Catholic Bishops, “The Challenge of Peace: God's Promise and Our Response; A Pastoral Letter on War and Peace” (Washington, D.C.: U.S. Catholic Conference, May 3, 1983).

22 Administrative Board of the USCC, “Statement,” p.307.

23 PCJP, “An Ethical Approach,”p. 604.

24 Ibid., p. 603.

25 The bishops point out that over 30 percent of developing country debt at the time was owed to U.S. commercial banks and the U.S. government, imposing a special responsibility on the U.S. Church to speak out. See Administrative Board of the USCC, “Statement,” p. 307.

26 Administrative Board of the USCC, “Statement,” p. 307.

27 Ibid., p. 308.

28 Ibid., p. 310.

29 Ibid.

30 Ibid., p. 312.

31 Ibid., p. 310.

32 Ibid., p. 311.

33 Ibid.

34 Ibid., p. 312.

35 Ibid.

36 Ibid., pp. 312–13.

37 PCJP, “An Ethical Approach,” p. 605.

38 Ibid.

39 Ibid., p. 610.

40 Administrative Board of the USCC, “Statement,” p. 313.

41 Ibid., p. 314.

42 Ibid., p. 313.

43 “Jubilee 2000: Cancel Zambia's Debt,” ecumenical pastoral letter of the Christian Council of Zambia, the Evangelical Fellowship of Zambia, and the Zambian Episcopal Conference, August 7, 1998, in Fr. Joe Komakoma, ed., The Social Teaching of the Catholic Bishops and Other Christian Leaders in Zambia: Major Pastoral Letters and Statements (Ndola, Zambia: Mission Press, 2003).

44 Peter Henriot, S.J., “Should Zambia Pay Its Debt?” National Mirror, August 18, 2004.

45 Elizabeth A. Donnelly, “Seton Hall Conference Discussion Summary” (Conference on the Ethical Dimensions of International Debt, Seton Hall University, October 22–23, 1998), p. 3; available at http:\\www.usccb.org/sdwp/international/shusum500.htm.

46 Peter Henriot, S.J., “Governance Issues and External Debt Relief for Poor Countries” (unpublished paper, January 13, 2003); available at http:\\www.jctr.org.zm/publications/gov-debt.htm.

47 Peter Henriot, S.J., “Connecting Debt and Trade from a Development Perspective: Challenges for Ireland and the EU” (paper presented at the International Jesuit Network on Development conference “Debt and Trade: Time to Make the Connections,” Dublin, Ireland, September 9, 2004), p. 3.

48 Henriot, “Should Zambia Pay Its Debt?”

49 Henriot, “Governance Issues and External Debt Relief.”

50 Interview with Ann Pettifor, March 8, 2001.

51 Jubilee 2000 U.K., “New Year Brings Call from the Pope, Bono, and Salman Rushdie”; quote taken from Q, February 1999, p. 149; available at http:\\www.jubileeresearch.org/jubilee2000/quotes.html.

52 See Jubilee 2000, “How It Was Achieved,” at http:\\www.jubileeresearch.org/jubilee2000/final/how.html.

53 Pope John Paul II, “Tertio Millennio Adveniente” (November 10, 1994); available at http:\\www.vatican.va/jubilee_2000/docs/index.htm.

54 Jubilee 2000, “How It Was Achieved.”

55 See Jubilee 2000, “Who We Are,” at http:\\www.jubileeresearch.org/jubilee2000/about.html.

56 Ibid.

57 Cardinal Basil Hume, “International Debt: An Introductory Address,” February 12, 1996; available at http:\\www.catholic-ew.org.uk/briefing/9603/9603009.htm.

58 For a summary of the proceedings and alternative views on the causes of the debt overhang, allocation of monies to debt relief in relation to development assistance, which countries should receive debt relief, the efficacy of the HIPC Initiative, and the ethics of conditionality, see Elizabeth A. Donnelly, “Seton Hall Conference Discussion Summary.”

59 Administrative Board of the United States Catholic Conference, “A Jubilee Call for Debt Forgiveness,” April 1999; available at http:\\www.nccbuscc.org/sdwp/international/adminstm.htm.

60 Ibid., p. 8.

61 Ibid, p. 13.

62 The additional relief was to be deemed warranted by a revision in the criteria for “sustainable” debt, principally measured by two ratios: a net present value of debt of 150 percent of annual export earnings, down from 200–250 percent; and, for countries highly dependent on export income, a net present value of debt of 250 percent of annual government revenue, down from 280 percent.

63 Jeffrey D. Sachs, “A Millennial Gift to Developing Nations,” New York Times, June 11, 1999; available at http:\\www.jubileeresearch.org/jubilee2000/news/sachs14jun.html.

64 In the case of Zambia, for example, the HIPC approach assumed 5.5 percent annual growth in the volume of exports, 5 percent annual GDP growth, a significant increase in foreign direct investment, and balance-of-payment support in the form of grants. Jubilee Zambia campaigners pointed out that these were unrealistic given Zambia's previous track record, economic volatility and decline, and an international environment marked by war.

65 Peter Henriot, S.J., “Is HIPC Good for Zambia?” (undated); available upon request at http:\\www.jctr.org.zm.

66 See Jubilee 2000, “G8 Cancels More Debt—An Important Step but Only a First Step,” June 22, 1999; available at http:\\www.jubileeresearch.org/jubilee2000/news/cologne24jun.html.

67 As recently as September 2004, Henriot complained that “Zambia's policies on civil servant wages, further privatization and hiring of teachers are dictated not by national consensus but only by one thing: meeting the elusive HIPC completion point.” Henriot, “Connecting Debt and Trade from a Development Perspective,” p. 3.

68 Much of the intellectual and advocacy work can be traced to a series of papers involving the Catholic Agency for Overseas Development and other NGOs in the U.K. See Henry Northover, “An Alternative Approach to Debt Cancellation and New Borrowing for Africa,” CAFOD, October 2003, and the references cited therein; available at http:\\www.cafod.org.uk/var/storage/original/application/phpQ5RY1l.pdf.

69 Debayani Kar, “G-8 Deal: First Step on a Long Journey, Jubilee USA Calls on World Bank/IMF to Expand Country List, Cut Harmful Strings,” Drop the Debt, Jubilee USA Network newsletter (Washington, D.C., Fall 2005), pp. 3, 4; available at http:\\www.jubileeusa.org/resources/newsletter0905.pdf.

70 Pope Benedict XVI, “Deus Caritas Est” (December 25, 2005), sect. 28a; available at http:\\www.vatican.va/holy_father/benedict_xvi/encyclicals/documents/hf_ben-xvi_enc_20051225_deus-caritas-est_en.html.

71 Cf. Thomas Massaro, S.J., “Don't Forget Justice,” America 194, no. 9 (2006), pp. 18–20.

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Ethics & International Affairs
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