[Congressional Record Volume 146, Number 127 (Thursday, October 12, 2000)]
[Senate]
[Pages S10399-S10400]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     NEED FOR ACTION ON DEBT RELIEF

  Mr. BIDEN. Mr. President, in the last days of this Congress, as we 
scramble to compete our work, I am worried that one of the most 
important issues before us may slip through the cracks.
  Last week, I attended an extraordinary meeting at the White House, 
where President Clinton called together religious and political leaders 
to discuss the urgent need to provide debt relief for the poorest 
countries of the world. Looking around the table, it was clear that 
this was no ordinary issue, no ordinary meeting.
  Just a partial list of the people in that room speaks volumes about 
this issue. There were bishops of several denominations, and a rabbi. 
The Reverend Pat Robertson was there, as was the Reverend Andrew Young. 
Democratic Congresswoman Maxine Waters was at the table, not far from 
Republican Congressman Spencer Bachus. A few seats from the President 
himself sat near the rock star Bono, who has become one of the most 
prominent spokesmen for the cause of debt relief.
  President Clinton called us together because the need for debt relief 
is great, the logic of debt relief is compelling, and time left for us 
to pass debt relief legislation is alarmingly short. Failure to act now 
would be nothing less than a failure of the United States to lead what 
could be the most important international effort to bring the poorest 
nations of the world into a more positive, constructive role in the 
world economy.
  Here are the facts, Mr. President. Around the world today, many poor 
nations actually pay more in interest payments to advanced industrial 
nations, and to international development banks, than they do on 
childhood immunizations, primary education, and other essential 
services.
  Tragically, Mr. President, many of these countries are suffering 
through an AIDS epidemic that dwarfs any public health crisis the world 
has ever seen. No responsible person can argue that we have no interest 
in helping such countries fight against communicable diseases that are 
just a jet flight away from our cities. No moral person can argue that 
we should sit idly by while a continent loses a generation to disease.
  The debts these countries owe are often the legacy of earlier 
governments, propped up by lending that suited the purposes of Cold War 
geopolitics, but that did precious little for the poorest of the poor 
in those countries. Today, the prospects of repayment by these 
countries is so small that the loans are now carried on our books at 
just a few cents on the dollar. A sensible business decision--made 
every day in this country and around the world--is to simply write off 
bad debts, and let both borrower and lender move on.
  Following that sound economic logic, with the leadership and 
commitment of the United States, the major creditor nations of the 
world agreed several years ago to forgive some of the debt owed by the 
poorest of these countries. That program, known as the HIPC 
Initiative--for the ``Highly Indebted Poor Countries''--requires 
significant commitments by the poor countries if they are to qualify. 
They must commit to market-oriented economic reforms, reduce 
corruption, and use the savings from debt relief for essential poverty 
reduction programs.
  Already under way in several countries, the HIPC program has achieved 
tangible results--the kind of results we all want to see, and the kind 
of results that will be put at risk if we fail to fully fund our 
participation. In Uganda, money saved by debt relief under the HIPC 
program has allowed the government to end the fees for primary school 
students, fees that had kept enrollment down. Over the last four years, 
primary school enrollment there virtually doubled. That is what a well-
designed debt relief program can do.

  Because those debts are such a large part of the poor countries' 
income--often as high as thirty or forty percent--and because those 
same debts are realistically worth so little to us, a relatively small 
financial commitment on our part buys important economic assistance 
many times over. And because we are the leading economy in the world, 
Mr. President, our leverage is even greater. Other nations are waiting 
for us to act--the only prudent course for creditors working out this 
kind of deal--and that means that our relatively small contribution 
will trigger a major international initiative.
  But that leverage works both ways. Without us, the viability of the 
whole initiative remains in doubt. Our inaction has stalled any further 
action on debt relief in Latin America, and will prevent all but a few 
eligible African countries from participating.
  Something more than sensible, effective foreign policy is at stake 
here, Mr. President, which brings me back to that extraordinary meeting 
at the White House. The world's religious leaders, from the Pope to 
Billy Graham, in an interfaith, ecumenical unanimity rarely seen on any 
issue, have joined to challenge our nation's conscience. They have 
asked us to face the embarrassing fact that while we talk about 
providing assistance to the poorest nations--while in fact we do send a 
tiny fraction of our own record income and wealth abroad--at the same 
time we continue to collect interest payments on those nations' old 
debts.
  They have challenged us to follow the Biblical injunction to lift the 
burden of debt, in effect to put our money where we say our values are. 
They call on us to deal with the least fortunate in the way all of the 
world's great religions command. Now, when we are enjoying the best 
economic times in our history, as we stand as the most fortunate of 
nations, surely we can underwrite less than four percent of the overall 
cost of debt relief. That's right, Mr. President: our share is less 
than four percent of the total cost of the whole HIPC program.
  For that contribution, we will assure the full implementation of 
nearly 30 billion dollars of debt relief for the poorest 33 countries 
of the world.
  This program presents us with a powerful combination of economic 
logic and moral imperative. Here, in the last days and hours of this 
session of Congress, we must not let this opportunity slip away.
  Earlier this year, the Foreign Relations Committee passed full 
authorization of two key funding mechanisms for our participation in 
the HIPC program. First, we authorized use of the balance of the funds 
made available through a revaluation of the IMF's gold holdings, to 
provide them with the resources to finance their share of the debt 
forgiveness--an action that will have no budgetary impact, that will 
not cost us a dime.
  The Foreign Relations Committee also authorized the appropriation of 
$600 million for our share, between 2000 and 2003, of the HIPC 
initiative. Senator Helms, Senator Hagel, and Senator Sarbanes and I 
agreed on a set of conditions that would hold the Administration 
accountable for policies that will promote more focused, better 
monitored international financial institutions. But we agreed, in the 
end, that the program was too important to impose unworkable conditions 
or to require the kind of delay that could be fatal. It took compromise 
and good faith to achieve that agreement, which was reported out of our 
committee unanimously.
  Mr. President, I am here today to say that those principles must 
guide any final agreement. That means there must be no new, unworkable 
demands for overhauling international financial institutions like the 
IMF and the World Bank before debt relief can go forward. That will 
require the spirit of bipartisan accommodation that we achieved in our 
committee.
  So far the Senate has only appropriated $75 million for debt relief. 
This is only a place holder for a final amount, now under negotiation. 
The House has done somewhat better, but is still far short of the mark. 
One of the problems is that full authorization has not reached the 
Senate floor, where I

[[Page S10400]]

am confident it would receive overwhelming bipartisan support.
  Right now, as I speak, there is still hope that we can reach an 
accommodation on authorizing language that the Appropriations Committee 
is seeking before it provides the full amount of debt relief needed to 
make the HIPC program a reality.
  But time is running out, Mr. President, and we are dangerously close 
to forfeiting our international leadership on this issue. That means 
forfeiting not just our leadership in international financial affairs, 
Mr. President. If we fail to provide full funding for our participation 
in the international debt relief effort, we will forfeit something even 
more valuable: our moral leadership.

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