The duty of financial intervention
Might international finance be supporting and facilitating the work of dictators and autocrats? It is in fact not a lack of funding that could, for example, depose Jacob Zuma in South Africa, but rather his own party being put under intense pressure by a population that is wrought with wide-scale corruption orchestrated by Zuma himself. From 2009 to 2018, the markets were quite happy to part with billions in order to maximise their profits off the back of an economic development that profited only a tiny minority. Isn’t the Prime Minister of Malaysia, Najib Razak, currently being investigated by a taskforce who suspect him of having shifted hundreds of millions of dollars to his own bank account that were in fact intended to be used to maintain his country’s living standards? Finance, that vaunts itself for being neutral, amoral even, is indeed lending a helping hand to the cliques in power that are sapping their countries’ institutions while at the same time exacerbating their peoples’ misery. It would seem even that the markets are in some cases openly encouraging corruption and even criminal activity in some emerging nations. But why be surprised, today in the year 2020, that the grandiosity of capital is seeking to multiply its profits by granting juicy advances to dictators, helping to launder accounts, and exploiting the flaws of fiscal regimes? The chance to make profit is in fact gargantuan and the temptation almost infinite, with emerging nations owing 7.5 trillion dollars to their creditors!
Improvement of moral standards
In the interests of peoples being mistreated by their autocrats, why would democracies not put in place a system capable of short-circuiting corrupt regimes by hitting them where it hurts the most, that is to say, in their ability to fund themselves? The intolerable status quo, this eternal starting-over where one group lives in luxury at the expense of a whole swathe of the oppressed, must be stopped dead in its tracks by an organisation that would be equipped with the power of sweeping controls over the restructuring of debts, and therefore over the generosity that is of interest to, perhaps even an accomplice to, international finance. The improvement of moral standards in international banking practices must be imposed by a neutral institution that has a global reach and whose main mission is to determine whether the worsening of public debts in a certain country emanates from fraudulent practices, or because of mismanagement on the part of its leaders. What rule and what right declare that oppressed peoples must suffer the burden of a debt contracted by dictators? This yet-to-be-created organisation would also have as an objective the prevention of creditors from accepting debt restructurings of nations governed by leaders that were not democratically elected.
It then follows, and goes without saying, that these “odious debts”, a term used by professor of law Robert Howse, might be renegotiated or even wiped clean in the event of a return to democracy, because populations should not have to suffer the consequences of the reprehensible acts of leaders that abuse them. Following the same logic, investors who’d made a deal with the devil obviously wouldn’t be granted any protection from this institution. On the contrary, it would erase certain countries’ debts once they re-democratise, and this would directly cause international finance to think long and hard about giving loans to corrupt regimes… A decisive push must now be made for capital to finally become responsible, and for it to also accomplish its raison d’être of making profit, but not at the expense of grotesquely exploited populations.
May finance suffer the consequences of funding the odious debts of authoritarian regimes and may it channel its resources towards other nations of the world that are governed by leaders who have their countries’ vital interests at heart. As far as financial malpractice is concerned, it must be sanctioned with steely determination, by cutting off liquidity flowing to dictatorships, and by pulling the rug from underneath the investors that funded them.