Socialist Viewpoint, No. 7, September 1985. Page 23
FIDEL Castro has been taking time reschedule Cuba's $850m debt to the Western banks - by opening a to persuade America's big borrowers to refuse to pay their collective debts of over
At two special conferences in Havana, Castro set out the case from all angles — including the argument that the Western economies would actually benefit from writing off these American countries would have that much extra money to spend, and thus stimulate flagging export industries. Nobody would lose - apart from the bankers! Anyway, Castro argues, debts are unpayable because of high
This latest campaign by Castro is certainly hypocritical: he has not tried to adopt such a line in Cuba's own dealings with the Western banks, still less with Cuba's estimated $10bn the Soviet Union, and he knows full well that Soviet economic backing on anything like the Cuban scale would never be available for other Latin American countries.
It is also a classless policy, aimed not at mobilising the masses of Latin
• The new populist government headed by social democratic President Alan Garcia has cocked snook at the world's bankers, declaring tht Peru will limit interest payments to 10% of its export revenue.
Rejecting IMF monetarism, Garcia has argued that Peru will pay its 514 billion expense of further recession. A classic ex- debts but in its own time and not at the ample of bourgeois "anti-imperialism"
Garcia's stance is another indication of the acute economic and social pressures on the newly elected regimes Latin
America, attempting to balance between their natural allies and masters in the
Western banks on the one hand, and the mass electorate (and vulnerable domestic capitalist class) at home on the other.
He has matched his radical line on the debt question with populist moves against the perks and privileges of government and state industry employees.
But he is already at loggerheads with striking bank workers demanding a 20% wage increase - to match the current rate:
of inflation.
debt crisis
against their bougeois governments and their various wage-
"austerity" plans, but at persuading bourgeois economic experts and finance ministers that collective repudiation of foreign loans would be best policy. It amounts to a bizarre attempt al a continental cross-class front against the imperialist
In this respect, Castro's line is not new, but a revised version of his May Day 1980 appeal to the reactionary governments and feudal rulers of the OPEC oil states for a united front with Iran against the USA wThis is the time for OPEC to show what it is made of, to show that it wasn't created just to raise prices and amass huge fortunes. This is the trial of fire for OPEC, the countries and the countries of the Third World."
Predictably, they all failed the test!
In place of Castro's cross-class utopia of a "debtors' cartel" as a means to fight imperialist exploitation, the essential starting point must independence of the working class in
Cock-eyed optimist? Bolivio's new President Paz prepares to confront workers. Socialist Viewpoint, No. 7, September 1985, Page 24
Grappling with
• Brazil's government. with an ever-increasing $103bn debt. has won a 3-month stay of execution from the IMF, but scorned the routine IMF remedies as a long-term solution.
and central bank president have both resigned. leaving less orthodox figures in president Jose Sarney's government to try their policies. Real wages have already been cut by 50% over the pasts years. while inflation is running at 200% and the economy has slumped back into recession. Even at the height of the reBrazil's $12 billion trade surplus was payments on the foreign debt.
Now the country's Planning Minister. Joao Sayad. is adamant in rejecting the monetary restraint and cuts in government spending customarily demanded by the IMF. One of his aides declared:
I'm not going to entertain dismissing a quarter of the workforce just for the sake of macroeconomic stability."
President Sarney himself is echoing the same defiant note: Brazils economy must the debt with grow by at least 5 percent every year. and this must be the starting point of any readjustment programme:
Elsewhere he has insisted that he would not allow the "dogmatic intransigence" of the IMF and others to impose recession on Brazil.
It remains to be seen whether this stubborn stance will remain firm in the lace of pressure from the
Brazilian workers. who in either case face further speed-up and attacks on their living standards from multinational employers' Sarney's capitalist cabinet. will need to establish their own line of struggle rather than wait for the outcome.
• Bolivian workers are again out on strike as we go to press. this time against the brutal austerity measures of the newly-elected right wing government of President Paz
Estenssoro. Under conditions of
14,000% inflation, the peso has been devalued by 95% from 75.000 to the dollar to 1.5 million.
But wages have been frozen until
December. while petrol prices are raised by 900%. There is to be a major shakeup for state-owned industries.
where miners in particular have waged repeated struggles for workers"
control.