[p2p-research] Haiti and debt

[Andy Robinson]

Rather strange to think about Southern debt in terms of someone "having to
pay"...  The debts are mythical rather than real in any case - they cannot
be repaid, they are only ever repaid by further loans, and they serve to
keep countries in a dependency that will most likely prevent them from ever
being able to repay and keep them taking out further loans.  The debt is
most often simply defined as such - it is a product of assumed existential
inferiority.  Default would certainly have redistributive effects, but not
in terms of anyone "paying" - rather, people who might otherwise have
benefited from uneven flow would stop benefiting in future (much the same
way people would have to pay more if trade with the South was fairer).  As
to whether there would be 'less credit in future' - loans to countries are
extremely political.  If there weren't loans, there'd be tied aid, there'd
be something else because it's the only way to keep the South in the global
economy.  The real question is not whether institutions would choose to lend
on market terms, but whether US (or future hegemon) policymakers would be
prepared to see Nigeria or Pakistan become a future Somalia through the
collapse of externally-funded patronage webs, with all this entails in terms
of 'black holes' and 'failed states'.  Writing off debts on grounds of
'odious debt' would not affect further lending to less dictatorial regimes
in any case; if anything it would increase corporate social responsibility.
In any case, an end to further exploitative loans may well be a benefit for
many societies (as opposed to the rich elites).  I doubt it would impoverish
the poorest countries further, and they could spend whatever income they
make on 'untied' public spending.  It's possible the currencies would
collapse, but as long as a country has saleable 'resources' it will find a
way into the commodity economy (c.f. cases of state collapse such as Sierra
Leone).  Politically, the ideal scenario would be for all the big Southern
countries to autoreduce their debts simultaneously, while increasing
connections with one another.

There are other dimensions to the Haiti situation as well:  America has
staged a series of occupations of the country, the longest being from
1915-34.  It was during this period that the Haitian army was created as a
force to suppress the Haitian poor.  The Duvalier dictatorships were thus
basically an American export.  America helped restore democracy in the 90s
but then systematically blocked aid to the Haitian government and hamstrung
its attempts at progressive social reform.  Meanwhile, far-right
paramilitaries and elite business groups received massive aid.  In 2004,
American-armed paramilitaries simulated a crisis and American marines
abducted the democratic president.  Until 2006, Haiti was ruled as a
dictatorship by a neo-Duvalierist regime propped up by UN troops, with
contingents from Canada and France.  UN troops were repeatedly implicated in
massacres, mass arrests and genocide in poor communities (5-10,000 were
killed during these two years).  All the major powers bear a lot of blame
for Haiti's predicament, including the Britain (for security council
involvement) and the UN, but especially America, Canada and France who have
the biggest investments and have interfered most often.

Also, Haiti is internally a deeply stratified society - the second most
unequal country in the world.  This stratification is highly racialised.
Nearly all the business elite are white or mixed-origin, and French or
English speaking, in distinction to the majority.  Until the late 1990s,
rural-origin Haitians had an inferior legal status as 'moun andeyo' or
outsiders.  Haiti is a site for some of the world's cheapest sweatshops,
owing largely to the decimation of the rural economy by the neoliberal
elimination of the internal market (bans on Haitian subsidies combined with
imports of heavily subsidised US products).  For a time in the 1990s, Haiti
was the global sweatshop capital which other extremely low-wage countries
were competing to underprice.  All to the benefit of Northern companies, and
(more rarely) consumers - big chains such as Disney are notorious for their
Haitian wages.  In other words, there have been unjust flows of resources
from Haiti to the North by means of exploitation of poverty.
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