ALERT!!
(and an update!)

KEEP THE PRESSURE ON:
CANCEL THE DEBT! DIMINISH THE IMF'S POWER!

October 21, 1999
This is a critical time in the struggle for debt cancellation and economic justice in the U.S. The calls made in response to the alert of Oct. 14 have already proved very effective. We need to keep the pressure and build on our momentum.

The previous alert requested calls to members of the U.S. House Banking and International Relations Committees in support of amendments to HR 1095 (the "Leach Bill") which would:

1) de-link its debt relief from structural adjustment;

2) put necessary restrictions on the use of proceeds from IMF gold transactions; and 3) cancel debts owed by the most impoverished countries to the IMF as a precondition of future IMF funding.

The calls you made had an immediate impact. The "mark-up" of HR 1095 in the International Relations Committee, scheduled for Tuesday, October 19, was postponed, apparently because of the heat we caused. The Treasury Department and its Congressional allies are, presumably, pondering how to deflect attacks on the IMF. Our message -- that the IMF and its conditions have no place in determining the future of impoverished countries -- is gaining momentum.

We now have a multi-pronged strategy. In addition to continuing to educate members of the Banking Committee, there are also two very good pieces of legislation that deserve support. That means there's something for almost everyone to do, whether your Representative is on the Banking Committee or not.

Our suggested strategy going forward is this:

1. If you had substantial contact with the office of a Representative on the House International Relations Committee, please call them back and urge them to talk with Reps. Gilman and Gejdenson, the senior committee members, about the shape of the bill when it does eventually come before the committee. Debt cancellation must be a mandatory (not optional) part of the bill, and the debt cancellation must be totally de-linked from IMF conditions. The amendments to make the necessary changes are being sponsored by Rep. Sherrod Brown (D-Ohio) and others.

2. Continue to contact Representatives on the Banking Committee and urge them to support the amendments proposed by Rep. Bernie Sanders (those amendments and a listing of Banking Committee members are listed in this alert).

3. Urge any and all Representatives to co-sponsor the two bills described below (noting the list of those already co-sponsoring).

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Amendments in the Banking Committee

Several amendments have been prepared for the mark-up of HR1095 that would limit the powers the Leach Bill would hand the IMF and, if accepted in their entirety, would make the resulting legislation a genuine step forward in canceling debts and extricating the IMF from the fate of impoverished people in many countries.

The three most important amendments will be offered by Rep. Bernie Sanders (I-Vermont) and others. They would do the following:

1. De-link debt relief from structural adjustment. This amendment would bar the conditioning of debt relief on any SAP designed or monitored by the IMF.

2. Require the IMF to cancel all debts owed to it by the 42 heavily indebted poor countries and Haiti. This amendment would withhold further U.S. appropriations to the IMF until the institution has used its own resources to cancel those debts.

3. Limit the IMF's ability to use its gold reserves for its own purposes. This amendment would condition the required Congressional approval for gold transactions on the IMF canceling all debts owed it by the HIPC countries and abiding by more comprehensive requirements for transparency and accountability.

Banking Committee members should also be urged to express their support for these measures to Rep. Spencer Bachus (chair of the relevant subcommittee and a key player on this matter), and, if Democrats, to Rep. Maxine Waters (Bachus's counterpart) as well.

See Banking Committee List at the end of this Alert

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The DEED Act and the Debt Relief & IMF Reform Act

By demonstrating broad support for these bills, we can more effectively make the case for amending the Leach Bill. At the same time, the bills stand on their own, and apart from the debate on the Leach Bill, their supporters are going all out to make them law.

Overlapping in some ways, and complementary in others, both bills would bring about meaningful debt cancellation for the most impoverished countries in the world, and move toward their liberation from the clutches of the International Monetary Fund (IMF). The IMF's structural adjustment programs have condemned the majority of populations in country after country to reduced social services (health, education, etc.), job loss, rising prices, rising interest rates, currency devaluations, and privatization of state industries. Only by reducing the power of the IMF can debt cancellation have a lasting impact, and only by wiping out the unpayable mountains of debt can the people of much of Africa, Latin America, the Caribbean, and Asia have a hope of better futures.

The Debt Emancipation to Enable Democracies (DEED) Act, HR 3049, was introduced by Reps. Cynthia McKinney (D-Georgia) and Dana Rohrabacher (R-California) and presently has 18 co-sponsors. The Debt Relief and IMF Reform Act, HR 2939, was introduced by Reps. Dennis Kucinich (D-Ohio) and Jim Saxton (R-New Jersey), and has nine co-sponsors.

How the bills overlap

Both bills insist on the closure of the IMF's most destructive component, the Enhanced Structural Adjustment Facility (ESAF). In a cynical maneuver last month, the IMF renamed this notorious agency the Poverty Reduction and Growth Facility, and appropriated for itself an expanded role encompassing poverty reduction plans -- the area in which the institution has proved itself most diabolically incompetent. Some Congressional staffers may think the name change means a change in substance; they should be urged to look beyond mere words, because they'll find the same poisonous programs.

The bills would both withhold any further U.S. funding for the IMF until the Treasury Department certifies that ESAF/PRGF has been shut down and no other part of the IMF continues any programs with structural adjustment conditions.

Both bills also call for true write-offs of the debt owed the IMF. Under the present "debt relief" program of the IMF and World Bank, the institutions still insist on being paid -- they just get the funds from contributions made by "donor countries." They have more than ample resources, however, to write off debt without extorting more money from taxpayers in the U.S. and elsewhere. Both bills insist that the IMF canel all debts owed it by the countries defined by the World Bank as "heavily indebted poor countries" (HIPCs), as well as Haiti, the poorest nation in the Western Hemisphere. The U.S. Government Accounting Office (GAO) has just completed a report finding that the IMF has understated its available funds by $19 billion!

How the bills complement each other

The Saxton-Kucinich Bill focuses on the IMF's secretive effort to use sales of its gold reserves to pump up its ability to impose structural adjustment. Gold re-valuation was recently approved by the institution's board, ostensibly for debt relief, but what the media accounts haven't explained is that over half of the gains realized would go instead to funding new structural adjustment lending (which they may now call "poverty reduction" or simply "reform programs" to avoid the taint of "structural adjustment"). HR 2939 would prohibit that maneuver by withholding the necessary Congressional authorization for any IMF gold transaction.

The Saxton-Kucinich bill imposes further reforms on the IMF as a condition for any gold transactions, in particular needed moves to increase the transparency and accountability of the institution.

The DEED Act aims to provide immediate debt cancellation for the world's poorest countries, provided they are democratic or firmly on a path to democratization. In addition to the measures to encourage multilateral debt cancellation described above, it provides for cancellation of the debts owed to the U.S. by HIPC countries and Haiti. It authorizes the necessary funding (an estimated $600 million) for the U.S. to write this debt off entirely. The democratization requirements the countries must meet include civilian control of the country's most important institutions and governments elected by free and fair elections.

In addition, the DEED Act encourages governments receiving debt cancellation to apply the resulting savings to poverty reduction by restricting further benefits from the U.S.'s export credit agency, the Overseas Private Investment Corp. (OPIC), to those countries where the President certifies that the funds made available by the cancellation of debts have been used for poverty reduction.

Please call the Capitol switchboard at 202/224-3121 and ask for your Representative's office. Urge her/him to sign on as a co-sponsor of both the Debt Relief and IMF Reform Act (by calling Rep. Kucinich's office) and the DEED Act (by calling Rep. McKinney's office). If she/he is already a co-sponsor of one (see lists below), offer your thanks, and urge her/him to co-sponsor the other as well!

For more information:
50 Years Is Enough: U.S. Network for Global Economic Justice
202/IMF-BANK; <wb50years@igc.org>

Co-sponsors of the Debt Relief & IMF Reform Act - HR2939

Kucinich (D-OH)
Saxton (R-NJ)
Campbell (R-CA)
Jackson Jr. (D-IL)
Hinchey (D-NY)
Conyers (D-MI)
Clay (D-MO)
English (R-PA)
McKinney (D-GA)
Sanders (I-VT)
Lee (D-CA)

Co-sponsors of the Debt Emancipation to Enable Democracies (DEED) Act - HR3049
McKinney (D-GA)
Rohrabacher (R-CA)
Carson (D-IN)
Delahunt (D-MA)
B. Thompson (D-MS)
Rush (D-IL)
D. Davis (D-IL)
Stark (D-CA)
Meek (D-FL)
Woolsey (D-CA)
Hilliard (D-AL)
Sanders (I-VT)
Kucinich (D-OH)
Evans (D-IL)
S. Brown (D-OH)
Fattah (D-PA)
Pelosi (D-CA)
Baldwin (D-WI)
Jackson Jr. (D-IL)

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For calls to urge support of the Sanders Amendments to the Leach Bill (HR1095) --

House Banking Committee
On the following committee list, cities are provided to give approximate location of the Represenative's district. Representatives are Republicans unless a "D" or "I" (for Independent) follows their name.

Alabama: Bachus (Birmingham), Riley (Auburn)
California: Campbell (San Jose), Royce (Fullerton), Ose (Sacramento), Waters (D-Los Angeles), Sherman (D-Sherman Oaks), Lee (D-Oakland)
Connecticut: J. Maloney (D-Danbury)
Delaware: Castle (whole state)
Florida: McCollum (Orlando), Weldon (Melbourne)
Georgia: Barr (Marietta)
Illinois: Manzullo (Rockford), Biggert (Hinsdale), Gutierrez (D-Chicago), Schakowsky (D-Chicago)
Indiana: Carson (D-Indianapolis)
Iowa: Leach (Iowa City)
Kansas: Ryun (Topeka), Moore (D-Kansas City)
Louisiana: Baker (Baton Rouge)
Massachusetts: Frank (D-Newton/New Bedford), Capuano (Cambridge)
Minnesota: Vento (D-St. Paul)
Montana: Hill (whole state)
Nebraska: Bereuter (Lincoln), Terry (Omaha)
New Jersey: Roukema (Ridgewood)
New York: Lazio (Long Island), King (Massapequa), S. Kelly (Mt. Kisco), Sweeney (Saratoga Springs), LaFalce (D-Buffalo), C. Maloney (D-Queens), Velazquez (D-Brooklyn), Ackerman (D-Queens), Meeks (D-Queens)
North Carolina: W. Jones (Greenville), Watt (D-Charlotte)
Ohio: Ney (Zanesville), LaTourette (Parma Hts.), Tubbs-Jones (Cleveland)
Oklahoma: Lucas (Oklahoma City & west)
Oregon: Hooley (Salem)
Pennsylvania: Toomey (Allentown), Kanjorski (D-Wilkes-Barre), Mascara (Washington)
Rhode Island: Weygand (Warwick)
Texas: Paul (San Marcos), Bentsen (D-Houston), Sandlin (D-Marshall), Gonzalez (D-San Antonio)
Utah: Cook (Salt Lake City)
Vermont: Sanders (I-whole state)
Virginia: Goode (D-Charlottesville)
Washington: Metcalf (Bellingham), Inslee (D-Bainbridge Island)
Wisconsin: Ryan (Racine), Green (Green Bay)

Call Your Representative through the Capitol Switchboard: 202/224-3121