European countries must support the United Nations’ proposals for sovereign debt restructuring! – Open letter to the UN by 19 economists

On September 10, the United Nations General Assembly will vote on nine principles concerning the restructuring of sovereign debts. Abiding by such principles would have avoided the pitfalls of the Greek crisis, in which political representatives gave in to creditor demands despite their lack of economic sense and their disastrous social impact. This public interest resolution must be supported by all European states and brought into the public debate.

The Greek crisis has made clear that individual states acting alone cannot negotiate reasonable conditions for the restructuring of their debt within the current political framework, even though these debts are often unsustainable over the long term. Throughout its negotiations with creditor institutions, Greece faced a stubborn refusal to consider any debt restructuring, even though this refusal stood in contradiction to the IMF’s own recommendations.

At the UN in New York exactly one year ago, Argentina, with the support of the 134 countries of the G77, proposed creating a committee aimed at establishing an international legal framework for the restructuring of sovereign debts. This committee, backed up by experts of the UNCTAD, today submits to vote nine principles that should be respected when restructuring sovereign debt: sovereignty, good faith, transparency, impartiality, equitable treatment, sovereign immunity, legitimacy, sustainability and majority restructuring.

In recent decades, a debt market has emerged that states are constrained to submit to.

Argentina, standing at the forefront of these efforts, has been fending off “vulture funds” ever since it restructured its debt. These funds recently succeeded in freezing Argentina’s assets in the United States through the intervention of the American courts.

Yesterday Argentina, today Greece, and tomorrow perhaps France as well: any indebted country can be blocked from restructuring its debt in spite of all common sense. Establishing a legal framework for debt restructuring, allowing each state to solve its debt problems without risking financial collapse or the loss of its sovereignty, is a matter of great urgency in promoting financial stability.

THE GREAT BERNIE SANDERS MONEYBOMB IS COMING, September 8 is Bernie's birthday and the power of small donors will meet the revolution of social media

While the front pages of The New York Times and the evening broadcasts of the television news are bannering stories of candidates from Hillary Clinton to Jeb Bush raising big dough from big donors and reaping the benefits of giant Super PACs, the legions of grassroots supporters of Bernie Sanders are quietly marching across the playing fields of social media and planning a small donor moneybomb extravaganza to celebrate the birthday of their champion on September 8.

Stay tuned: the Sanders moneybomb will be a big deal that will fuel organizing for other big deals that have already begun from even larger crowds at big rallies and mass organizing for Democratic caucuses.

The concept of the small donor moneybomb was pioneered in earlier campaigns by former Republican congressman and presidential candidate Ron Paul, who like Mr. Sanders was a candidate of conviction and ideas, with a large and devoted following and savvy grassroots activists who believed in the revolutionary potential of social media.

Ron Paul’s moneybombs were brilliantly successful for his campaigns and the Sanders campaign began to pick up the moneybomb torch earlier in the campaign. The September 8 Sanders moneybomb event could well become a seminal moment in presidential politics by bringing together a political cause, an individual candidate, a progressive movement that is in a historical moment of ascendancy, and a social media revolution that has already generated exponentially larger crowds than other candidates and will promote surging turnout at presidential caucuses that will confound insiders.

We should recognize and publicize the fact that Bernie Sanders is the only presidential candidate who is talking about what the IMF is doing to Greece, the only presidential candidate who has a track record of opposing the IMF, the only presidential candidate who, if elected, is likely to do anything to end the economic violence of the IMF.

When more Democrats own the fact that the IMF agenda is the NAFTA-WTO-TPP agenda with a European internationalist smiley face mask pasted on, the IMF will be on a fast train to the dustbin of history. And this is not necessarily a remote prospect - the fact that this is the fundamental identity of the IMF is well known among labor activists, for example.