In the Congo, timber sales have fallen to disastrous levels. In the United States, banks are failing, auto manufacturers are shakier than a cat in a room full of rocking chairs, and the retail market is so unstable that this “Holiday Season” may be over before it really begins. Around the world, debt crisis, bank failure and unsustainable debt is turning economies on their heads, making a mockery out of what people thought they knew about investment, about the economy and about the stability of the American economic system.
One analyst, more aggressive than most, says this current crisis is but the calumniation of a series of debt crises which began in the Third World in the 1970’s.
What I can’t help seeing is a relentless migration of ‘debt crises’ from the ‘Third World’ (primarily Africa and Latin America) in the 1970s and 1980s, via the ‘Second World’ (primarily the former Soviet Union, Japan and Southeast Asia) in the 1980s and 1990s to the ‘First World’ (primarily Europe and the US) in the 2000s and beyond. (David Ransom, First World Debt Crisis)
As far as the current debacle is concerned, as early as 2003, some economists were pointing to a probable collapse of US and British economies. In a system where consumers consumed ad infinitum, it was only a matter of time before they generated an unsustainable debt load, and the whole system came crashing down like a deck of cards.
“Gullible consumers, acting as heroically as Atlas once did, are holding up the US and UK economies by dutifully borrowing and spending. But take-home pay is falling in the UK, and unemployment is up in the US, so consumers will soon buckle under the strain of single-handedly propping up these economies. As we live in a deflationary era, the burden of debt will be much more painful than it was say, during the aftermath of the Lawson boom.” (IMMINENT FIRST WORLD DEBT CRISIS WORSE THAN ‘THIRD WORLD, 2003. New Economics Foundation)
Already in deep trouble, unable to repay their debts, many Third World countries are sliding further into the abyss, as exports tumble and their former customers—industrialized countries, face economic catastrophe. Many say the West’s long ride to economic supremacy has come to an end, along with the world, as we know it.
Even as industrialized countries get a taste of what the Third World has faced for decades, Third World countries continue to struggle to repay debt to hostile international banking entities. Around the world, exports have fallen, crippling the ability of many Third World to repay their loans, increasing their debt, saddling them with crippling debt which many will never be able to repay.
Now, world debt has taken on a new guise, as faltering economies, failing banks, plummeting real estate values, a shrinking manufacturing sector and skyrocketing business bankruptcy threaten the very core of Western capitalism. In the greatest irony of all time, Western economies, the US in particular, are depending on a historic communist enemy to bail their economies out and forestall depression.
In this slowing economy, as interest rates pile onerous debt on top of debt, Third World countries are dealing with economic pneumonia, as their debt interest increases and their ability to repay the debt decreases. Historically, Third World countries have been at the mercy of Western monetary policy, including what many call the rapacious banking ideology perpetrated by the “World Bank.” Now, it seems that the tables are turned: what many Third World countries have experienced over the last few decades has now headed to the industrialized nations.
Today’s economic meltdown is far reaching consequences from New York to Zimbabwe, as the most vulnerable economies reel from the tsunami current meandering through the international economic system. Unfortunately, the current crisis isn’t the first lethal injection of economic poison to hit the Third World. As far back as the 1980s, Western economic and monetary policies have had adverse effects on African, Asian and Eastern European nations.
· Extrapolating from UNICEF data, as many as 5,000,000 children and vulnerable adults may have lost their lives in sub-Sharan Africa as a result of the debt crunch since the late 1980s.
· The United Nations fears another 3 million children will die in the poorest countries of sub-Saharan Africa by 2015, the target for the Millenium Development Goals to cut poverty by half.
· Some 11 million children die each year around the world, not just Africa, due to similar conditions of poverty and debt.
· These statistics typically define childeren (sic) as those under the age of five. What about 6, or 7, for example? (Anuk Shah, The Scale of the Debt Crisis, 2005)
Millions have died and continue to die because of monetary policies generated by people from across the globe. Now, it seems that those policies are catching up with the so called “First World”, those industrialized countries who are advanced enough to have manufacturing and finished goods exporting economies.
As Europe, the US and China play ping pong with global debt, the pain that so-called advanced economies are now facing has been pandemic in the Third World for generations. This 10 year old essay delineates the devastation ‘advanced economies’ in the West inflict on less advanced economies in the Third world.
