3rd world debt

[deja vu]

Okay, so who thinks the 3rd world debt should be cancelled?

[ahinton]

Okay, so who thinks the 3rd world debt should be cancelled?

It hardly really matters in the grander scheme of things; of course it's an important subject, but not one on which anyone should really pronounce unless they have equally valid answers as to what should also happen about second and first world debt - and how it should happen, too. We're all in it up to and well beyond our eyeballs. Let's get a grip on that fact and accept it before we start moralising about third world debt, however important it is (and it is, without doubt)...

Best,

Alistair

[BoliverAllmon]

even if we did forgive all the debts, they would just go back into debt immediately

[gilad]

africa needs the means to produce, it needs investment, it needs education, it needs an understanding of economy.
the old adage “Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime"

[musik_man]

If I thought that giving money to Africa would really help it, I'd be all for it, but all I see is that it props up corrupt regimes that are the true reason for Africa's poverty.

[stevie]

even if we did forgive all the debts, they would just go back into debt immediately

your use of the words 'we' and 'they' signify that you seperate yourself from the 3rd world.

'we' are humanity, and 'they' are us.

if people are starving and dying, we - as humanity, are in a crisis.

dont know enough about the actual financial implications of the question, but i just wanted to make that point.

[stevie]

If I thought that giving money to Africa would really help it, I'd be all for it, but all I see is that it props up corrupt regimes that are the true reason for Africa's poverty.

yes, this appears to be a major part of the problem, which is why money should be given intelligently, to regenerative things like agriculture and education.

but how will the dictatorship and regimes come to an end, will this end up like iraq?

[gorbee natcase]

Investment being the key word. But what government would take the risk in these unstable countries, and even private enterprise for that matter.

[gilad]

Investment being the key word. But what government would take the risk in these unstable countries, and even private enterprise for that matter.

i live in south africa and i know sweden have done some useful investment here over the years, in finanace and education. im no economist though, i just know sweden are often mention in these terms.

[BoliverAllmon]

your use of the words 'we' and 'they' signify that you seperate yourself from the 3rd world.

'we' are humanity, and 'they' are us.

if people are starving and dying, we - as humanity, are in a crisis.

dont know enough about the actual financial implications of the question, but i just wanted to make that point.

point taken. I use the words "we" and "they" to differentiante between countries that have lent the money and the countries that have borrowed the money. Nothing more.

[deja vu]

your use of the words 'we' and 'they' signify that you seperate yourself from the 3rd world.

'we' are humanity, and 'they' are us.

if people are starving and dying, we - as humanity, are in a crisis.

dont know enough about the actual financial implications of the question, but i just wanted to make that point.

huh? where has all this caring-sharing bullsheeyat come from?

lol I'm not saying you're wrong or anything

It's just very unlike you

[stevie]

  i thought i was always caring and sensetive 

it was a bit random, and admittedly somewhat of a stereotype, but many westerners, particularly americans, seem to think of themselves in a secular way, that theyre/were not part of the rest of the world...
i, personally, prefer to be 'judged' if at all, by individuality, as opposed to the social group that i form a part of, which i was born into.
fact is, many people in unfortunate places, are born into places with less luxurious situations than the members of this forum.

hahah randomly?!

[joeplaysthepiano]

Two main things to consider, if we forgive 3rd world debt:

1.  Who will ever loan money to these countries in the future?  (Not me!!!)

2.  What is the incentive for these countries to honor their debts in the future when they can get away with not paying?

Because of these reasons, I think 3rd world debt forgiveness is wrong.

[ahinton]

Without at all wishing to undermine the general thrust of this thread or the undeniable importance of its subject, I cannot but help note that no remarks have yet been made about the debtor nations other than in the "third world". Let's hear from those who believe that they know of countries that are not in debt...

Best,

Alistair

[BoliverAllmon]

Without at all wishing to undermine the general thrust of this thread or the undeniable importance of its subject, I cannot but help note that no remarks have yet been made about the debtor nations other than in the "third world". Let's hear from those who believe that they know of countries that are not in debt...

Best,

Alistair

true doesn't Japan have thy highest debt in comparison to their GDP of all none third world countries? something like 140% or something. That is why I laugh at the liberal media they make a huge deal about our national debt, but in comparison to other countries we are not doing that bad at all. We currently are in debt of something around 66% of our GDP. Our debt looks so big, because our GDP is so friggin huge.

boliver

[quasimodo]

3rd world, and in particular, Africa, is an alcoholic paraplegic tied in chains.
To get that patient walking again, you have to
1) Remove the chains (write off the debt);
2) Take the patient to a detoxication program (get rid of corrupt regimes);
3) And then rehabilitate (investment and so on)

In that order.

[ahinton]

3rd world, and in particular, Africa, is an alcoholic paraplegic tied in chains.
To get that patient walking again, you have to
1) Remove the chains (write off the debt);
2) Take the patient to a detoxication program (get rid of corrupt regimes);
3) And then rehabilitate (investment and so on)

In that order.

And your recipe for achieving this would be...?

Best,

Alistair

[quasimodo]

And your recipe for achieving this would be...?

Best,

Alistair

Who said there's any recipe? Steps 2 and 3 are very very complicated to achieve if they will ever be.
My point is just that writing-off the debt is the first, very easy yet necessary step. But it doesn't guarantee at all that problems will be solved afterwards.

[ahinton]

Who said there's any recipe? Steps 2 and 3 are very very complicated to achieve if they will ever be.
My point is just that writing-off the debt is the first, very easy yet necessary step. But it doesn't guarantee at all that problems will be solved afterwards.

No one "said" so. I simply asked. You are absolutely correct in your observation that Step 1 cannot guarantee either Step 2 or Step 3. So, effectively, the entire series of steps is just not going to be achieved. Such achievement will become even less of a possibility when 1st and 2nd world debt becomes - and is recognised as - an equally large problem in terms purely of the debt itself (I'm not comparing the nations in any other respect, of course). Almost every nation on earth is in debt to some degree.

Best,

Alistair

[jakev2.0]

3rd world countries have mismanaged economics. You can't solve the problem of wealth disparity between poor and rich countries by injecting money into these poor countries, running away, and hoping it all sorts itself out.

Higher saving rate as proportion of income (i.e., higher investment) will result in higher capital per worker and more wealth. You could expand on this by desiring lower rate of population growth, but this is a social rather than an endogenous economic variable. The Solow growth model proves and verifies all these conclusions.

Fundamentally, freer trade will also raise household income in the long run. Free trade and globalization is the best hope for poor countries.

[prometheus]

The only way to solve the third world problem is to actually pay the third world farmers the money they deserve and to stop the western countries from protecting their farmers/markets with tax money.


Until this happens eventhough I support all other attempts to help out third world economies it won't really make much of a difference. Especially not when there still is war in Africa.

War and the western world trade-thingy are the main reasons why many African countries are so poor.


I would also like to address the only third world country in the America's: Haiti. One of the main reason they are still a third world country is the frequent US meddling in their state affairs.


It's kind of ironic. Two of the most valuable colonies, Haiti and Bangladesh, are now some of the poorest countries in the world.

[jakev2.0]

The only way to solve the third world problem is to actually pay the third world farmers the money they deserve and to stop the western countries from protecting their farmers/markets with tax money.

Do you know what happens when farmers are paid subsidies to produce? In short, it makes farmers who are not paid subsidies worse off. People who lobby for "fairtrade" fail to perceive the problems caused by propping up the value of certain commodities (such as coffee) at above equilibrium price. Low prices for coffee are a market signal for the farmer to produce something else. Artificially propping up the prices distorts this signal. With all due respect, these are principles of basic microeconomic theory and thus your argument does not hold water.

Until this happens eventhough I support all other attempts to help out third world economies it won't really make much of a difference. Especially not when there still is war in Africa.

War and the western world trade-thingy are the main reasons why many African countries are so poor.

The West is the best chance poor countries have for economic prosperity.

I would also like to address the only third world country in the America's: Haiti. One of the main reason they are still a third world country is the frequent US meddling in their state affairs.

Why is Ethiopia poor? Why is Madagascar poor? Why is Kyrgyzstan poor? Why is Peru poor?

Oh right...the meddling of insidious Western colonial overlords!

[prometheus]

Low prices for coffee are a market signal for the farmer to produce something else.

Yes! Coca plants!

The market tells them to produce coca. But when they do we send weapons of mass destruction after them; chemical warfare.


And at the same time we use the WTO to force undeveloped countries to accept our tabacco countries dumping tabacco on their markets because western people are now educated enough to realise it damages your health and have stopped buying them.

We westerners are hypocrites. Fair trade isn't subsidising. It's just the opposite. We need to stop subsidise our own farmers.

[jakev2.0]

Yes! Coca plants!

The market tells them to produce coca. But when they do we send weapons of mass destruction after them; chemical warfare.

I was arguing economics... now I *think* you're trying to make some political point. Fine. Whatever

And at the same time we use the WTO to force undeveloped countries to accept our tabacco countries dumping tabacco on their markets because western people are now educated enough to realise it damages your health and have stopped buying them.

Obviously people still smoke tobacco in Western countries. Obviously it has some worth because people are willing to pay for it. I don't see your point, anyway.

We westerners are hypocrites. Fair trade isn't subsidising. It's just the opposite.

Dude, "fairtrade" as in "100% fairtrade coffee" is, in definition, a subsidy to some farmers to produce coffee. 

. We need to stop subsidise our own farmers.

Heh, I agree! The market almost always works best when the forces of supply and demand are left alone. The freer market the better.

[prometheus]

Dude, "fairtrade" as in "100% fairtrade coffee" is, in definition, a subsidy to some farmers to produce coffee. 

It's a seperate market where consumers are out of free will willing to pay more for a product because we refuse to abolish our own real subsidies.

As far as I know it has no government support or tax cut.

What is the alternative?