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Round 1. Raideur V ktprktpr: First World Debts

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posted on Jun, 24 2005 @ 11:01 AM
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The topic for this debate is "First world countries should forgive the debts owed them by third world countries."

Raideur will be arguing for this proposition and will open the debate.
ktprktpr will argue against this proposition.

Each debater will have one opening statement each. This will be followed by 3 alternating replies each. There will then be one closing statement each and no rebuttal.

No post will be longer than 800 words and in the case of the closing statement no longer than 500 words. In the event of a debater posting more than the stated word limit then the excess words will be deleted by me from the bottom. Credits or references at the bottom do not count towards the word total.

Editing is Strictly forbidden. This means any editing, for any reason. Any edited posts will be completely deleted.

Excluding both the opening and closing statements only one image may be included in each post. No more than 5 references can be included at the bottom of each post. Opening and closing statements must not contain any images, and must have no more than 3 references.

Responses should be made within 24 hours, if people are late with their replies, they run the risk of forfeiting their reply and possibly the debate.

Judging will be done by an anonymous panel of 13 judges. After each debate is completed it will be locked and the judges will begin making their decision. Results will be posted by me as soon as a majority (7) is reached.

This debate is now open, good luck to both of you.




posted on Jun, 24 2005 @ 03:16 PM
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First world countries are able to, and thus should forgive the debts owed to them by the Third World.

Good luck to ktprktpr, the only person with a name I am unable to pronouce.


Since the end of the Second World War, new countries have come from the ceased european colonies at an incredible rate to the point where Africa alone has more nations in it than any other continent. These newly freed states that had been used and abused by the occuping country for centuries, and with the exception of few, are almost entirely undeveloped. These countries are still jungles and deserts. Many of them lvie in huts and hunt their food. They have virtually no income, no economy, no industrial base, and in many cases, cannot even feed their own population.

However, these countries, now free, have borrowed heavily from the rich nations of America and Europe to try and develop their country as a good government should. However, faced with the daunting task of building a modern country from the ground up, with no economic base and no cash reserves, they had no choice but to go into debt to begin the transformation into the future.

Nature is rarely cooperative, and neither are rich bankers. Over the years, droughts and floods, ignorance and plagues has wasted much of that borrowed money, and now left with their starting position, plus new debt, they have utterly no hope of digging themselves out of this gigantic hole. Naturally the hole deepens as they continuously try to dig out, and with the little support they have gained from the developed world, they are doomed to not only remain unmodernized, but also be controlled indirectly by the First World nations, who control their debts.

However, the idea of forgiving the debts and allowing Third World Nations to correct their situation is vital to global development. If these nations were to remove these economic shackles and give these nations, being the very poorest people on the entire globe, they would stand a good chance of bringing their nation up to the point in which they can function with the rest of the world.

In this debate, I will highlight the reasons in which we, as First World Nations, should allow the developing world a chance to become functioning and productive members of the world community. However, this will never be possible as long as we continue to believe "a debt is a debt, and must be paid." If this idea is kept as policy, Africa, and many nations in Asia will forever remain nothing but a burden on the First World, non productive, pone to disaster, and highly unstable.

Thus I argue that we forgive these debts in the name of global development and allow these deprived nations to join us at the world table as true, free standing nations of pride.



posted on Jun, 25 2005 @ 01:49 AM
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The recent push for African debt abolition stems primarily from the Commission for Africa which is led by Tony Blair. This same Commission has published a 464 page report[1], titled "Our Common Interest," which explores various reasons and solutions regarding Africa's predicament. While Tony Blair, and others, are proponents of African debt relief, all sides agree that Africa has more pressing problems; specifically, if governmental tendencies are not changed, then debt relief will do little good:


Unless there are improvements in all these areas this Commission has concluded, after a detailed review of all the evidence, that all the other reforms we will recommend – in international trade, debt and aid – will have only limited impact[2].


It is typical of the Western world to view humanitarian problems as equations to be solved by more cash. However, this is not appropriate from an Afro-centric perspective and I will illustrate why in this debate.

In a series of three postings I will argue (but I'm not restricted to) that

(A) The ultimate aim of debt reconsideration is to make Africa's ascension to the world stage easier. However, I will show that before money must come solutions. Namely, solutions to other social problems, such as corruption, human right violations and disruptive armed conflict.

(B) I will elaborate upon the irony of forgiving one series loans in a situation where another series of loans are required for mere governmental survival and while no provisions have been made to correct the underlying problem. This point emerges from point (A) but touches upon the inaptness of straight up debt forgiveness.

(C) Finally, I will consider the cultural and social implications of debt relief. The fact of the matter, by common sense, is that many Africans would chose to pay off the debt if they had the funds to do so while remaining financially stable. This hints at alternative solutions to outright debt abolition. Perhaps something along the lines of retroactively eliminating interest and applying past and future payments directly to the principle. This requires a certain kind of faith, a faith that the best kind of African debt abolition comes not from the hands of whites, but blacks. For in this scenario, we would have proud Africans paying off their collective debt on top of a burgeoning economic system. Self-sufficiency and self-improvement are always prettier than questionable paternalism and dependency.

For these reasons, and others, I will argue that debt forgiveness is not appropriate and that there are other and better solutions.

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[1] www.commissionforafrica.org...
Commsion For Africa, "Our Common Interest: Report of the Commision for Africa," Tony Blair, et al.
[2] ibid, pp 39



posted on Jun, 25 2005 @ 03:13 PM
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My first point during this debate will be to outline the purely economic reasons for forgiving Third World debt.

The first reason for this would be the immediate effect it would have on the developing world. To clear this debt, which is often in the top three expenses of smaller nations, would give them a direct boost to their economy, allowing them to focus on more pressing issues of food production or infrastructure.

The second reason would be the growth of new markets in the world. Currently, most of the third world cannot buy food, let alone anything produced by a First World country. The long term development of these nations would be a massive boon to the world not only by allowing citizens buy First World goods, but also allowing their governments to buy services and goods from the developed world. This includes anything from construction projects, to economic planning, to defense budgets.

The third and final reason in which it is in our best interest from a purely monetary standpoint would be the dollars and euros saved from being given to the third world nations in aid, disaster relief, and other funds, due to the fact these countries are economically disabled by debt. These countries are also commonly at war, and not only does this harm their economies further, but all too often forces the First World to intervene to stop it. These actions are not cheap, and wouldn't be nessesary if the warring countries were economically stable, which will only happen if they are allowed to develop their land, instead of paying interest on loans they begun over 20 years ago.

In terms of the capitalist, sometimes it pays to be nice.



posted on Jun, 26 2005 @ 02:34 PM
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Here I will detail the argument that debt forgiveness is not a practical solution:

Have you examined the currency rates for African countries lately? Take Uganda for instance. One shilling is worth a grand total of 0.0005763 US Dollars (5.673 x 10^-4 USD) [2]. An average Ugandan man earns 4,000 shillings a day, which equates to 2.30533 US Dollars[3]. If debt forgiveness enabled the common Ugandan man to purchase from the Western markets how many services and goods could he buy? I'll place this question into context of a well known Western country: As an American, how much can you buy for 2.3 US dollars? I can't even buy lunch at my neighborhood Chinese store for that amount.

Now consider this: If debt forgiveness somehow trickled down to the common man (a la Reaganomics) and resulted in a miraculous wage increase of, say, 200%, how much would the common Uganda man earn? Since all earnings are relative we can't directly say because purchasing power depends upon the dynamics of free markets. And free markets follow the principles of Supply and Demand. If the citizenry suddenly has more money then they will have more money to spend. An increase in spending will drive common prices up and in the end their "purchasing power" will remain the same. This is standard micro-economics. A more considered route must be taken.

Additionally, the example above assumes that corruption, an increase in local taxes and other severe social problems will have no negative effects. For this reason it is widely recognized that other problems, such as corruption, must be dealt with before money matters can be dealt with[4]. Seventeen prominent Africans, each from a different country, and Tony Blair, agree. This is because money is merely a fluid that flows through social systems. And the social system that siphons greedily and can not presently heed its constituents' cries deserves repair. So here we need the pressing need for social change, a need higher than simple debt forgiveness.

And so we turn an exploration of point (C):

Are there any benefits of repaying debt, however incurred, as opposed to having it forgiven? The answer lies within the social value and effects, along with how that debt is imposed.

One might be tempted to think:


The benefit of debt forgiveness is that a given country could re-channel its financial reserves to other, more needed, avenues. On a social level, this act would be a rare case of Western powers appeasing Africans. With more money circulating within Africa, only Africans could benefit.


When many talk of debt forgiveness they make the naïve assumption that the international credit community would abolish their current contracts without being averse to lending to those same countries in the future. This is extremely unrealistic. I paraphrase the dynamics of this complex issue from Issue Analysis, no. 9 below:



A key economic issue here is one of confidence and credibility. A credible reputation for servicing one's contracted obligations is a country's greatest assets in the international financial market. Do proponents desire to undermine the debtor countries' reputations for meeting their obligations and thereby damage their prospects of access to foreign capital? [5]


… and since I can't say it better than Dr. Harper, I must quote him:



But allowing heavily indebted nations to walk away from their debts sends precisely
the wrong signal to the community of international lenders. What confidence can they
have to lend more funds when their own or other lenders’ funds have been confiscated
arbitrarily? … Poor countries need to develop reputations as responsible borrowers who not only deploy the borrowed funds productively but who also repay their debts as contracted. How will debt cancellation help poor countries achieve either of these goals? [6]


So then, what becomes the solution if it's not debt forgiveness? Instead of debt forgiveness, I propose a form of debt relief, but not total debt forgiveness. If the interest upon current debt were frozen and previous payments applied to the capital, Africa would be on a studier current and future financial base In this fashion the debt can be repaid while the Commission for Africa, headed by Mr. Blair, maneuvers for aid and social change. Here the debt question has not been terminated without regard to the future, but managed such that it might be serviced without crippling the recovering nations of Africa. And, in the end, as we all agree, the best debt relief comes from the hands of Africa. That can only occur under an astute managed policy of change the does not shirk current financial responsibility at the expense of future access to critical capital for economic growth.

----

[2] wwp.greenwichmeantime.com...
[3] news.bbc.co.uk...
[4] see first posting, [1]
[5] pp 5, www.cis.org.au...
[6] pp 3 Ibid



posted on Jun, 27 2005 @ 01:05 PM
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Here I will now argue the humanitarian side of this issue for dropping the Third World debt.

First of all, many nations in debt would have been out of debt and directly improving their nation if it were not for the huge interests that seem to overwhelm their ability to pay them off.



Nigeria borrowed $5 billion, paid $16 billion to date and still owes $32 billion.


Is that fair?

Secondly, the sheer notion of purposely keeping nations in debt is virtual ecomonic imperialism. Debt nations have no choice but to agree to First World Nations to which they owe the debt. It also allows First World Nations to exploit the people, since they technically "owe" these rich bankers.



Even interim debt relief is conditioned on the requirement that countries sign a new loan.


Countries have seemingly no hope of every breaking the chains of debt and standing firmly on their own feet as long as they are constantly rattled for interest on debts they should of paid off long ago.

Thirdly, even as nations are indebted by interest, they also recieve some of that money back as "gifts" or "aid" from First World Countries, however never as much as they pay us in just interest. These nations are suddenly morally indebted to us because of our "aid." It almost sounds as if we are using the debt to pry money from the poorest nations on earth so that we can give they "gifts." Having given them something for free, they now have to cooperate or submit to our requests. Economic imperialism.

Finally, we have to remember that this debt is killing people. It is keeping the population from getting educations, or improving infrastructure, and progressing into functioning nations. The sheer interest on loans whos inital balance was paid off years ago now steals money from the very schools and hospitals that we support with our own tax dollars or with our own charity. These nations have the potential to save millions of lives and improve their nations, and although nothing is instant, nothing would be more direct and benfical than to remove the biggest burden from their backs.

Sources:
www.jubileeusa.org.../learn_more&page=why_drop_the_debt.html



posted on Jun, 28 2005 @ 04:17 AM
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My opponent casually admits that many African countries exist in a deplorable state. Specifically it is written that "[h]owever, faced with the daunting task of building a modern country from the ground up, with no economic base and no cash reserves, they had no choice…" However, as I've mentioned above, debt forgiveness destroys Africa's credit history.

A debt lender gives out loans only when she expects the loan to be repaid. I fail to see how Africa gains from debt abolition when it loses credit standing in the process. Even if debt were forgiven, Africa would still require foreign aid and loans. And therein lies the crux of the problem. Debt forgiveness is a short term solution to a long term problem. This fact is echoed in the writings of Commission for Africa by their insistence that other areas must improve before foreign aid or debt forgiveness is administered. This means that the impact of debt forgiveness, all in all, would be minimal because of Africa's fatal reliance upon aid transfusions. In considering the present, you must consider the future if you're to have a future at all.

And Nigeria is a perfect example of this. The Paris Club of Creditors[1], from which Nigeria owes roughly $22 billion dollars, realizes this foresight. They have chosen to reschedule Nigerian debt over an 18-20 year period.[2] It was Nigeria that pleaded for debt reduction and forgiveness, yet Nigeria chose to accept the debt rescheduling. This only highlights just how important future access to capital is for an emerging African country. The fairness in this situation is holding respect for future obligations and thereby being allowed future capital access. That's fair. Nigeria chose all this under president Olusegun Obasanjo. His understanding of the foreign debt and aid dynamic was repudiated by Nigerians when he was re-elected with 61.8% of the vote in 2003. [3]. Mr. Obasanjo's choices, as repudiated by the Nigerian people, speak with greater power than I or Raideur could devise upon the humanitarian side of this issue.

And speaking of foresight, Raideur's second quote shows a marvelous lack of it. She or he points out that countries subject to debt relief are required to sign a new loan. This is merely commonsense. If I decide to charge you less, wouldn't you and I want to draw up a new contract stating this? I would expect so and fail to see any evil in this.

I will now sound the drum of mourning:

1. My opponent has failed to explain how countries that "… have virtually no income, no economy, no industrial base, and in many cases, cannot even feed their own population," can survive by severely damaging their access to future capital. Mr. Obasanjo exists as a counterargument to any kind of idealistic bootstrapping argument which may be forthcoming.

2. My opponent fails to describe how these nations "…stand a good chance of bringing their nation up to the point in which they can function with the rest of the world." without any hint of social or governmental reform. This is the same kind of reform that includes responsibility and that same responsibility, as a maturing nation, must extend to debts. Mr. Obasanjo found a way acceptable to his people and so can others.

3. My opponent strangely asks us to believe that "true, freestanding nations of pride" are more prideful when debt is forgiven from Western hands than from their own.

4. We are asked to throw aside all forms of Earthly micro-economics and believe that the same nations living in deserts and huts can suddenly take part in Western markets via the miracle of debt forgiveness.

In taking all these facts and arguments together, one realizes that Africa truly needs a solution that resolves each aspect of its crisis. Not a solution that resolves one aspect while throwing the rest out the window. The pillars of nation building reside in stability and economic growth. These facets are shaped from the hard sweat of demonstrated responsibility and maturity at various levels.

All of this is brought about by a respect to those that assist and a respect towards a nation's constituents. This includes servicing debt, not ignoring it. For Africa to even buy a pair of bootstraps many changes are required, as Commission for Africa points out. I have outlined positive solutions in this regard and, ultimately, have shown that debt forgiveness is a mirage that will leave future Africans in a greater state of despair than they are now. I can only hope, one day, that Africa's gains obtained through mature reform and debt management will cause the judges, Raideur and I to tremble in awe.

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[1] slate.msn.com...
[2] www.dmo-ng.org...
[3] en.wikipedia.org...



posted on Jun, 29 2005 @ 09:16 AM
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Raideur forfeits his reply due to lateness, ktprktpr continues.



posted on Jun, 29 2005 @ 01:47 PM
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Even from a logical standpoint, it’s obvious that debt forgiveness is not needed in the situations and conditions that Raideur outlines. This is because the current problem is the financial impact of the debt. This impact is lessened, transformed into something manageable, by relief, which I advocate. The burden of the impact becomes useful as an international demonstration of responsibility and maturity. If Africa shrugs and topples its responsibility, much like Atlas, then all is lost. For this simple reason debt forgiveness obviously isn’t a requirement, or even a desirable action.

I have pointed out that humanitarian issues have been successfully handled, specifically by Nigeria. The president’s re-election supports this point. I'm sure I could dig up other examples.

There is not much left for me to argue. I apologize for this short rebuttal and I await my opponent’s final conclusion with renewed vigor. I’ll leave the panel with an African proverb of un-attributed origin:


No matter how long the night, the day is sure to come. -African Proverb



posted on Jun, 30 2005 @ 04:27 PM
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Raideur has forfeited his closing statement due to lateness.

ktprktpr please close the debate.



posted on Jun, 30 2005 @ 09:17 PM
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Well, I hope my opponent is all right in real life.

I will summarize my position through a collage of previous efforts. I will sprinkle facts where necessary:

The Commission for Africa, which is led by Tony Blair, notes that:

Unless there are improvements in all these areas this Commission has concluded, after a detailed review of all the evidence, that all the other reforms we will recommend – in international trade, debt and aid – will have only limited impact[2, opening]

Debt forgiveness is really the process of allowing African funds to migrate elsewhere. But, as we've seen over the years. Africa can't generally maintain it's cash. Looking at the situation critically, the observer finds that money is merely a fluid that flows through social systems. And the social system that siphons greedily and can not presently heed its constituents' cries deserves repair. So here we need the pressing need for social change, a need higher than simple debt forgiveness.

When many talk of debt forgiveness they make the naïve assumption that the international credit community would continue to lend as before. I now refer the reader to citation [6] of Dr. Harper, in my second post. Basically, he states that "Poor countries need to develop reputations as responsible borrowers who not only deploy the borrowed funds productively but who also repay their debts as contracted. How will debt cancellation help poor countries achieve either of these goals?"[6, second post]

Really, debt forgiveness is a short term solution to a long term problem. This fact is echoed in the writings of Commission for Africa by their insistence that other areas must improve before foreign aid or debt forgiveness is administered.

So then, what becomes the solution if it's not debt forgiveness? Instead of debt forgiveness, I propose a form of debt relief, but not total debt forgiveness. Here the debt question has not been terminated without regard to the future, but managed such that it might be serviced without crippling the recovering nations of Africa.

And Nigeria is a perfect example of this.

All of this is brought about by a respect to those that assist and a respect towards a nation's constituents. This includes servicing debt, not ignoring it. For Africa to even buy a pair of bootstraps many changes are required, as Commission for Africa points out. I have outlined positive solutions in this regard and, ultimately, have shown that debt forgiveness is a mirage that will leave future Africans in a greater state of despair than they are now.

Thus ends my conclusion. I wish to take this opportunity to remind the judges that they're judging the quality of debating as shown by both sides. Not if a particular debator has convinced them or swayed them (if they did, then great, if not, so what).



posted on Jun, 30 2005 @ 09:31 PM
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Nicely done, ktprktpr and Raideur. It's off to the judges! Tally-ho!



posted on Jul, 6 2005 @ 11:14 AM
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The votes have been tabulated and Kptrkptr has won by a landslide.

Good job on the parts of both debators. But in the end, there can be only one....


Comments:

A good series of points were raised by both of you during the discussion



ktprktpr is the winner as he expanded more on his points of argument and went into more detail.



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