OVER THE LAST three decades, reclaiming the biblical concept of Jubilee has proven a powerful rallying point for campaigners demanding that the debts of the world’s poorest nations be cancelled. People of faith have been inspired to find that an Old Testament principle of debt cancellation (see Leviticus 25) could have such contemporary relevance. As a commentary in the British newspaper The Observer, normally skeptical towards Christianity, said in 1999, “So who said religion was dead and there was no God? ... it is no longer [economists] Morris, Keynes, and Beveridge who inspire and change the world. It’s Leviticus.”
The cancellation of debt was no new idea, even to the modern world. Generous 1953 debt release helped Germany become a responsible player in a postwar Europe. Later Indonesia, seen as a bulwark against communism, was allowed to pay its debt to the group of rich creditor nations, the Paris Club, interest-free, over 30 years. From the early 1980s, U.K. campaigners had been arguing that poor countries should also get debt cancellation. Yet the response from the Paris Club was half-hearted. Plan after plan—the Brady Plan, the Baker Plan, the Naples Terms, the London Terms, the Houston Terms—was little more than a placebo.
Meanwhile, interest rates soared as a result of the U.S. and U.K.’s monetary policies, while the prices poor countries received for commodities they produced continued to plummet. The debt owed by developing countries more than doubled during the late 1980s—until, for every dollar given in aid, three dollars were being returned in debt payments.