A Fate Worse than Debt
By Susan George
Penguin Books 1990 300 pp., $17
Reviewed by Jack Lance
In A Fate Worse than Debt George analyses the structure of global debt and its effects on all of us — the main ones being poverty, unemployment, violence and pangs of conscience (for some of us at least).
The book is like dropping an acid tab, a bad one; after a while it starts to hit you (the wrong way). It is also like dropping a stone in a pond and feeling the waves going out hysterically in all directions.
The worst bit is the relentless, remorseless and pitiless way in which global debt is managed: double-dealing with the not-so mythological devil from whom, theoretically, you can never win, whilst each transaction merely serves to burn the fingers further.
The way the international monetary institutions have arranged "the deal", not only can you never pay back the debt, but you can never escape from not paying it back either.
It has something to do with cumulative compounding interest on cumulative compounding interest on cumulative pounding interest on etc. Welcome to the hellfire club — the show that never ends.
But what is truly sick about this, is the way that the "big boys" (the monetary institutions) have full jurisdiction and justification, without the "wet blanket" of accountability. They get away with murder.
In A Fate, George demonstrates how the economic institutions, such as the World Bank and the International Monetary Fund, rather than aid countries, instead create, by their economic rules and regulations and "austerity programs", dreadful states of internal deregulation and devaluation, paranoia, illness, disease and death.
For the sake of flooding global markets with products, they are prepared to sacrifice the welfare of millions, and the eco-health of the world. Goods are sold to the global market at a dreadful cost to the anvil people living under that auctioneer's hammer or market forces.
"As we know, since the beginning of the 1980s, commodity prices have gone steadily downhill. This tailspin is partly due to IMF/World Bank export-led strategies and adjustment plans indiscriminately imposed on a great many countries at once. These agencies share responsibility for the price-depressing surfeit of goods on the market, because they insist that everyone exports a limited range of raw materials and semi-finished or finished products. They also encouraged countries on the road of 'export-led growth', helping to create their debt burdens."
There doesn't appear to be any brains, conscience or remote shred of sense behind these deliberate and wilful "arrangements".
In any case, the rigid competitive ideals of market forces are their own (and our own) worst-enemy, creating economic irrationalism into a vandalistic, self-defeating tragedy. If you are made poor and indebted, you can hardly buy anything (except with a loan of course).
But it's the system! It is in the nature of economics. This mechanism can only make prices fall, because of the principle of competition (John Stuart Mill, Ricardo and Adam Smith all knew this already back in the 1800s) which then transpires as loss (although not necessarily for everyone).
So many nations are undergoing the stress fractures of mindless/illogical earthquake economics, with people having to tighten their belts on starvation diets.
You have to read this for yourself: "A country like Brazil, for example, paid back $69 billion in interest between 1979 and 1985, and its only reward at the end of this period was to be deeper than ever in debt, owing even greater interest-payments."
Does that make sense? Mathematically yes, because interest is an insane abstract integer, which, on paper works out. Nevertheless, it is precision with a capital "D" for death/debt/destitution/disease/disaster.
Because of their rapidly-multiplying yearly debt on the crazy illusion of compounding interest rates, indebted nations have to flog off all their resource and raw material base as quickly as possible to offset minute portions of their debts.
The results are multifarious and many: totalitarian cruelty as bureaucrats and their hound-dog bureaucracies are immovably cemented into the centre of power.
In the way of competition, struggle and environmental consumption, as George pointed out, the debt of the global indebted nations is our debt and the outcome of their disaster is our very own too. We all fall down.
George treats the subject with authority, passion, compassion and precision. She certainly describes the faceless institutions that linger at the back of global events.
I'd like to nail down some gigantic permanent trapdoor on that funnel of death, because the Great Debt Spider is ultra poisonous. Its selfishness might kill us all.