Paying One’s Debts

RARELY has so much humbug been written as on the subject of the “Third World debt crisis.” Professional leftists want the debts of these countries, owed to Western banks or Western governments, to be written off altogether, and even the moderately progressive are urging a suspension of the payment of interest on these loans and a re-scheduling of the repayment of the capital.

It is very difficult to take these arguments seriously, for the banks are in no way to blame for the recklessness with which backward countries like Tanzania, industrializing countries like Brazil, Mexico, or Greece, and even wealthy nations Eke Sweden borrowed enormous sums of money abroad and squandered it. Why should the banks or other foreign lenders be expected to pay for the corruption, incompetence, and lack of foresight of underdeveloped politicians? Those who say that this should be done argue that otherwise the poverty of the peoples whose unrepresentative rulers borrowed so recklessly will be exacerbated. True, we have a duty to act charitably toward those who are living in poverty, but is it really wise to reward countries that hid their talents in the ground while failing to assist the more prudent poor?

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Christie Davies

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RARELY has so much humbug been written as on the subject of the “Third World debt crisis.” Professional leftists want the debts of these countries, owed to Western banks or Western governments, to be written off altogether, and even the moderately progressive are urging a suspension of the payment of interest on these loans and a re-scheduling of the repayment of the capital.

It is very difficult to take these arguments seriously, for the banks are in no way to blame for the recklessness with which backward countries like Tanzania, industrializing countries like Brazil, Mexico, or Greece, and even wealthy nations Eke Sweden borrowed enormous sums of money abroad and squandered it. Why should the banks or other foreign lenders be expected to pay for the corruption, incompetence, and lack of foresight of underdeveloped politicians? Those who say that this should be done argue that otherwise the poverty of the peoples whose unrepresentative rulers borrowed so recklessly will be exacerbated. True, we have a duty to act charitably toward those who are living in poverty, but is it really wise to reward countries that hid their talents in the ground while failing to assist the more prudent poor?