Jubilee Debt Campaign, the successor organisation to Jubilee 2000, today (8 December) called for a cancellation of many of the debts owed between European countries.
The NGO’s comments form one of the most radical suggestions so far, as politicians from across Europe struggle to reach agreement on the ongoing debt situation.
Jubilee Debt Campaign pointed out that that much of the debt had been built up by the private sector and only later taken on by governments. They insisted that the peoples of Europe should not have to pay for the irresponsibility of unregulated lenders.
The campaigners said that debt cancellation must be accompanied by strict regulation of international markets, to prevent a similar situation in future.
The French and German governments have proposed that all Eurozone countries should be obliged to commit themselves to balanced budgets. But Jubilee Debt Campaign said that this would neither address the causes of the current crisis nor prevent another one.
"Binding governments to balanced budgets is shutting the wrong stable door after the horse has bolted,” said the campaign’s economist, Tim Jones.
He insisted that, “Unregulated financial markets caused this debt crisis, not government borrowing. It is trade surpluses and deficits which need to be balanced to prevent debt crises, not government budgets.”
The campaigners argue that the debts between European countries are simply too big and austerity is making them bigger.
Jones added, “Debts have to be cancelled to allow countries to break free from cycles of debt and austerity. We also need to regulate financial markets to prevent the trade imbalances which cause a debt crisis.”
Jubilee campaigns have received widespread support from both Christians and non-Christians in the UK and elsewhere. Large numbers of churches and other groups backed Jubilee 2000 campaigns for the cancellation of debts owed by some of the world’s poorest countries to the west.
The organisation today emphasised the links between debt in the global south and the European debt crisis.
“Deregulated global finance has been causing debt crises in developing countries for the last thirty years,” declared Jones, “Countries need to act together to regulate finance and prevent debt crises, which increase poverty across the world.”