Did you know that 52 percent of American Evangelicals have a foot fetish (it’s not known if that includes children or, if not, what precisely the other 48 percent are up to)? Or, here’s another one: did you know that a full 76 percent of podiatrists are well practised at the art of erotic asphyxiation (I guess having a foot fetish would be a little too much like work), or, that when asked, a full 5 percent of readers of this article will think the author is funny? (Ed. Can you fact check this? It seems a bit high to me). The reason I know these facts to be the case is because the ever-so-malleable Bureau of Made Up Statistics has just told me so. And, having a name that sounds like its a government agency means it must be trustworthy, right?
Now, all joking aside, I am sure all you readers being educated sorts, know all about Quantitative Easing or, as it is known in economically literate circles the “money does grow on trees after all” theory. The theory of QE, roughly stated, is thus: A government is in debt and needs money. The government wants the banks to lend the government money but, alas, the poor banks are broke (hmm) and so don’t have any spare pocket change to give to the government, otherwise they would doubtless be the paragon of charity. Deflated (geddit?), the government has a brainwave: it can let the banks create lots of new money out of thin air and then use the money to lend to the government (via bonds). The banks are still poor, for theirs is a meager existence, but they have a future income as bonds are repaid and the government is suddenly flush with cash. To quote Aleksandr Orlov, “simples.”
If the Jubilee Debt Campaign is to be believed, it appears that someone in the recesses of the Department for International Development has been paying close attention to the machinations in Her Majesty’s Treasury Department. Here is Jubilee’s version of the story (with some literary embellishment on my part):
- Once in the distant past, the UK lent Sudan some money which it could spent on anything it so desired, as long as what it wanted was British goods; and
- The exact terms of the loan are not known (presumably, the documents were lost in the great floods of 1967, to quote Yes Minister); and
- In 1984 Sudan stopped paying off the loan. Perhaps they thought it was all paid off or the cheque got lost in the post; and
- When it stopped paying, it owed £173m; it is now £678m; and
- DFID have just found the IOU down the back of a departmental sofa or have just uncovered a long lost in-box and thought they’d better do something about this windfall treasure.
So, in sum, Sudan owes the UK money but the UK doesn’t have any of the paperwork on the loan, does not know what the loans were for, but has, nevertheless, still managed to almost quadruple the allegedly outstanding debt. In the UK the financial services industry is constrained in law, preventing it from enforcing repayment of any debts which have been unpaid and unacknowledged for six or more years; there is, it seems, no such reasonable limit on international loans, even if the contracts “got lost in the post.”
Of course, Sudan will not pay this debt and it is certainly debatable whether they should, but that has not, according to Jubilee, prevented some aspiring chaps at the Department for International Development (DFID) from developing a plan as cunning as a fox that has just been appointed Professor of Cunning at Oxford University. The plan is this: 1. the UK has a target to meet on international aid spending; and 2. The UK is owed a lot of money by Sudan who are not actually paying any back; and 3. Sudan needs aid; therefore, if the UK writes off the debt it can say it has given money to a country in need and chalk up that as a multimillion pound boost towards meeting the international aid spending target. That, despite the fact that Sudan will not have received a penny of extra aid nor will be spending a penny less in debt repayments.
Is this actually being contemplated? I don’t know. The evasive correspondence from DFID to which Jubilee refers may be a sign that such a plan is in the offing or it may be that there’s no one around in DFID between Christmas and New Year to make policy decisions and some underpaid junior official was just being careful, avoiding committing anything to paper. I have a feeling though that before long questions will, quite rightly be asked. We will discover if DFID will join HM Treasury in a new Quango, perhaps the United Kingdom Blank Cheque Bank; the bank which likes to say “can I add an imaginary zero or two to you deposit today, sir?”
In other news, recent research has suggested that Mary Tudor once lent a shilling to a Welshman who defaulted on the loan. The Welsh National Assembly is reported to have entered a Debt Management Plan to pay off the £15 trillion it owes in accrued interest; either that or Rupert Murdoch has offered to pay if Charlotte Church will do a couple more pro bono gigs for him. If that happens Charlotte Church may well have saved not only Sudan from the bailiff, but also single-handedly revitalised the world economy. She can sing too.