Jubilee Act Passed by U.S. House

25 April 2008 by Jubilee USA


Jubilee Act for Responsible Lending and Expanded Debt Cancellation Passes House of Representatives with Bi-Partisan Support - Senate Panel to Consider Issue April 24

WASHINGTON – Leaders of churches, development agencies, civil rights, labor, and human rights groups today praised the passage by the US House of Representatives by a vote of 285-132 of the Jubilee Act (HR 2634). The legislation calls the US Treasury Department to negotiate a multilateral agreement for debt cancellation for up to 24 additional poor countries that need cancellation to meet the Millennium Development Goals (MDGs).

Jubilee USA Network is an alliance of 80 organizations that has been leading the advocacy for the legislation. “We commend the US Congress for its bold step in passing the Jubilee Act and listening to the people of the impoverished nations who have borne the burden of unjust debt for far too long,” said Patricia Rumer, co-chair of the Board of Jubilee USA Network. “We hope that House passage will inspire the US Senate to move quickly to also pass the Jubilee Act and send it to the President for immediate action.”

“As Pope Benedict XVI makes his first Apostolic Visit to the United States, it is fitting that Congress show support for this important initiative that would help alleviate the debt burden of some of our poorest brothers and sisters around the world,” wrote Reverend Thomas G. Wenski, Bishop of Orlando and Chairman of the Committee on International Justice and Peace of the United States Catholic Conference of Bishops in a letter to Congress.

The legislation was introduced by Rep. Maxine Waters (D-CA) and Spencer Bachus (R-AL) in June 2007 and enjoyed the support of House Speaker Nancy Pelosi. A letter from leading Congressional supporters of the bill was circulated in Congress on Monday by Waters, Bachus, Financial Services Committee Chairman Rep. Barney Frank (D-MA), Foreign Affairs Committee Ranking Member Rep. Ileana Ros-Lehtinen (R-FL), Rep. Carolyn Maloney (D-NY) and Rep. Judy Biggert (R-IL). Jubilee USA is looking into the impact of an amendment that was attached to the bill in the final minutes of the floor debate which prohibits eligibility for countries with business interests in Iran.

In addition to authorizing broader debt cancellation, the bill seeks to reform current IMF IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org
/World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

policies and other global lending practices by:

* Urging that more resources be devoted to grants for the world’s poorest countries;
* Requiring greater transparency at the IFIs, including a policy of maximum disclosure in project and loan documents;
* Urging the development of a binding framework for more responsible lending practices in the future;
* Limiting the conditions that may be required of countries going through the debt relief process to those ensuring that money released by debt relief is used transparently and accountably to address poverty; and
* Directing the Government Accountability Office (GAO) to undertake an audit of “odious, onerous, or illegal” lending by the World Bank, IMF, and US government in specific countries.

Companion legislation has been introduced in the Senate (S. 2166), where the bill enjoys strong bi-partisan support and 26 co-sponsors. A hearing on the Senate companion to the Jubilee Act will be held in the Senate Foreign Relations Committee on Thursday, April 24 at 2 p.m. in Dirksen Senate Office Building Rm. 419. More information on debt and the legislation is available at www.jubileeusa.org.

Statements from Faith, Development, Civil Rights, Worker Rights, and Human Rights Leaders Following Passage of the Jubilee Act:

“We applaud the House of Representatives for its bi-partisan commitment to God’s children suffering from overwhelming debt burdens and extreme poverty by passing the Jubilee Act.” said Rev. Peter Rogness, Bishop of St. Paul, Minnesota and chair of the International Policy Committee of the Conference of Bishops of the Evangelical Lutheran Church in America. “Too many suffer under crushing burdens of debt that bury them in poverty. The Biblical vision of Jubilee is one that brings hope for the future for all of God’s children. This legislation will help achieve that vision.”

“We congratulate the House of Representatives for passing this important bill today, and urge the Senate to follow suit. Debt relief for the world’s poorest countries is an essential building block for sustainable, equitable, and democratic development — and also for a global economy that works for working families, here and around the world,” said John J. Sweeney, President of the AFL-CIO.

“The passage of the Jubilee Act by the House of Representatives is an important step towards building a world in which deadly poverty no longer stands in the way of the full flourishing of all God’s people,” said Rev. Dr. Clifton Kirkpatrick, Stated Clerk of the General Assembly of the Presbyterian Church, (U.S.A.)

“The NAACP was pleased and encouraged to see the Jubilee Act pass the House of Representatives with such strong bi-partisan support,” said Hilary O. Shelton, the Director of the NAACP Washington Bureau. “The United States must work to help the poorest countries throughout the world eliminate debilitating debt which undermines their ability to provide basic human needs such food, housing, education, health care and infrastructure development for their people now more than ever. We must now work hard to see the Senate act as quickly and as positively as the House so that this legislation can soon become the law of the land.”

“American Jewish World Service applauds the House for passing the Jubilee Act,” said Ruth Messinger, President of American Jewish World Service. “Funds going from poor countries to well-heeled financial institutions to service debt should instead be used to improve education, provide better healthcare for all people, and increase food security for the poorest. The House has spoken and the Senate must now take action to ensure that our prosperity is not a reward for exploiting developing nations.”

“We have been hoping and praying that the Jubilee Act is passed by Congress,” said Jim Winkler, top executive of the United Methodist Church Board of Church and Society. “We’re excited they’ve recognized that we must to do more to relieve the unbelievable burden that is preventing struggling countries from advancing. It is a justice issue, pure and simple.”

“The passage of the Jubilee Act in the House of Representatives represents a major milestone in the movement for debt cancellation,” said Adam Taylor, Senior Political Director of Sojourners . “Thanks to the Jubilee campaign, debt cancellation has become a bipartisan cause and a moral imperative. Sojourners now calls on the Senate to provide the bold and immediate leadership necessary to pass the Jubilee Act so that we can move a major step closer to restoring right relationships and achieving the Millennium Development Goals.”

“The passage of the Jubilee Act is another great milestone in the effort to remove the burden of unpayable debt that’s slowing the pace of development in the world’s poorest countries. The Jubilee coalition continues to be an effective voice for poor people around the world,” said Rev. David Beckmann, President of Bread for the World.

“Passing the Jubilee Act is a leap forward for the U.S. in living up to its promises to fight global poverty,” said Gerald LeMelle, Executive Director of Africa Action. “For years, the chains of illegitimate debt have crippled the ability of African countries to provide healthcare and education for their citizens. I applaud the House of Representatives for passing this bill, and urge the Senate to demonstrate a similar commitment to smart, people-driven development policy.”

“Passage of the Jubilee Act in the U.S. House of Representatives is welcome news to the people of Haiti. Meanwhile, Haitians are drinking dangerous water, eating mud cakes and dying of easily treatable diseases as the Haitian government weekly sends more than $1 million to development banks, repaying loans made to corrupt regimes like the decades-long Duvalier dictatorship,” said Brian Concannon, director of the Institute for Justice and Democracy in Haiti. “The $71.7 million Haiti will send to the World Bank and the Inter-American Bank this year alone could be better spent feeding Haitian citizens and stimulating Haiti’s economy. IJDH strongly urges the Senate to pass the Jubilee Act and give Haiti’s troubled democracy a chance to work.”

“It is incumbent upon the Senate to pass the Jubilee Act if there is to be any chance of fulfilling the promises made in the Millennium Development Goals. Wipe out debt, wipe out poverty!” said Kim Nichols, co-Executive Director of New York-based African Services Committee.

“The Jubilee Act is essential to pave the path to debt cancellation for those poor countries that have not gotten debt relief and to help prevent countries that have already benefited from sliding back into further indebtedness and from being subjected to harmful conditionalities from the International Financial institutions,” said Katherine Hoyt, National Co-Coordinator, Nicaragua Network.




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