WEBVTT - Mitu Gulati and Ugo Panizza on Haiti’s Odious Post-Colonial Debt 0:00:10.800 --> 0:00:14.080 Hello, and welcome to another episode of the All Thoughts Podcast. 0:00:14.160 --> 0:00:18.840 I'm Tracy Alloway and I'm Joe. Wasn't Joe. It feels 0:00:18.880 --> 0:00:22.520 like there's a lot of terrible things happening in the 0:00:22.560 --> 0:00:26.560 world at the moment. Yeah, it does. The news has 0:00:26.600 --> 0:00:33.120 been pretty grim, between the virus, Afghanistan, natural disasters. I 0:00:33.159 --> 0:00:36.320 would I would, I would agree with your assessment. Yeah, 0:00:36.400 --> 0:00:39.760 And I think the sort of pace of the bad 0:00:39.840 --> 0:00:42.080 news means that a lot of stuff is kind of 0:00:42.120 --> 0:00:45.519 getting buried in the news cycle very quickly after it happens. 0:00:45.560 --> 0:00:51.080 So we're recording this on auguste UM. Just a few 0:00:51.200 --> 0:00:55.880 days ago, there was a massive earthquake in Haiti. I 0:00:55.920 --> 0:00:58.880 think more than a thousand people are believed to be dead. 0:00:59.000 --> 0:01:01.440 But that death hole is probably going to go up 0:01:01.480 --> 0:01:05.720 some more um. But that event has already sort of 0:01:05.720 --> 0:01:09.959 been superseded by events in Afghanistan, and people have just 0:01:10.000 --> 0:01:14.280 sort of moved on to the next big global drama. 0:01:14.480 --> 0:01:19.280 But I wanted to dedicate this episode to Haiti because 0:01:19.840 --> 0:01:22.760 if you think about what the country has recently experienced, 0:01:22.800 --> 0:01:26.440 you know, the earthquake that I just mentioned came off 0:01:26.480 --> 0:01:30.880 the back of its president getting assassinated just last month, 0:01:30.920 --> 0:01:33.280 and then of course before that, Haiti has had a 0:01:33.319 --> 0:01:39.280 long history of natural disasters, Hurricane matthew in, a really 0:01:39.280 --> 0:01:44.320 really catastrophic earthquake back in and the country itself is 0:01:44.360 --> 0:01:47.240 one of the poorest in the world, so it in 0:01:47.360 --> 0:01:50.280 many ways it just feels like Haiti can't take a 0:01:50.320 --> 0:01:54.080 break or catch a break, right, I would say, pretty 0:01:54.160 --> 0:01:58.040 much all of my life, I think Haiti has been 0:01:58.440 --> 0:02:05.360 been known for violence, extreme poverty, international attempts at reviving 0:02:05.800 --> 0:02:09.120 the economy or domestic institutions that seem largely to have failed, 0:02:09.560 --> 0:02:13.960 and then of course they sort of unforeseen disasters. But 0:02:14.000 --> 0:02:18.040 I think you know, within particularly the Western hemisphere, Haiti 0:02:18.320 --> 0:02:24.320 is known to have had an extraordinary, extraordinary, extraordinarily bad fortune. Yeah, 0:02:24.520 --> 0:02:28.480 I'm glad you mentioned international efforts to revive the economy, 0:02:28.520 --> 0:02:31.919 because today we are going to be talking about one 0:02:32.400 --> 0:02:37.880 possible effort, and possibly the most obscure of those efforts, 0:02:38.240 --> 0:02:43.440 which involves bonds UM that were issued more than let's see, 0:02:43.840 --> 0:02:48.240 almost two hundred years ago UM as part of Haiti's 0:02:48.280 --> 0:02:51.959 independence movement, and there is a discussion now about whether 0:02:52.120 --> 0:02:56.239 or not you could possibly UM sort of unwind that 0:02:56.360 --> 0:03:01.440 debt in order to pay reparations to So it's sort 0:03:01.440 --> 0:03:05.560 of um an obscure thing, but it fits right into 0:03:05.600 --> 0:03:09.040 add lots and uh, you know our obsession with old debts, 0:03:09.160 --> 0:03:12.320 So we're going to get into it. I'm looking forward 0:03:12.320 --> 0:03:15.560 to this. This is odious debt one of the one 0:03:15.639 --> 0:03:17.560 of the topics that I think you've really done a 0:03:17.639 --> 0:03:20.240 great job sort of bringing to the forefront of media 0:03:20.280 --> 0:03:22.560 and odd lots and looking forward to this and talking 0:03:22.560 --> 0:03:25.800 about this in the Haiti context. No, thank you. Um well, 0:03:25.919 --> 0:03:29.000 I have to credit one of our guests, Mit to Glate. 0:03:29.240 --> 0:03:32.200 He's a professor at the University of Virginia. He's the 0:03:32.200 --> 0:03:35.520 one that introduced me to this concept. And we also 0:03:35.600 --> 0:03:39.960 have his fellow researcher, Ugo Panizza, a professor at the 0:03:40.080 --> 0:03:45.360 Graduate Institute of Geneva. So welcome Mitt and Uko, thank you. 0:03:46.000 --> 0:03:50.160 Shall we start with the very basics for people who 0:03:50.320 --> 0:03:55.320 haven't heard the concept of odious debt before, what exactly 0:03:55.360 --> 0:03:59.360 do we mean when we say odious debt? So they're 0:03:59.360 --> 0:04:06.720 theretly two meanings of odious debt as its discussed both 0:04:06.800 --> 0:04:12.160 in the popular press and in the academic slash legal literature. 0:04:13.280 --> 0:04:15.920 One meaning is just you know, any debt that you 0:04:15.960 --> 0:04:19.919 don't like it's just has a bad odor and you 0:04:19.960 --> 0:04:24.400 don't want to pay it back. The more technical legal 0:04:24.480 --> 0:04:30.479 meaning of odious debt is that it is debt incurred 0:04:30.520 --> 0:04:37.680 by a despotic leader without the approval of the population 0:04:38.520 --> 0:04:44.039 and the knowledge of the creditors, that these debts are 0:04:44.160 --> 0:04:50.080 being used for purposes that are contrary to any benefit 0:04:50.279 --> 0:04:55.159 that would result for the populace. So the classic example, 0:04:56.520 --> 0:05:00.960 and you know during the Bush administration, odious debtspeak very popular. 0:05:01.240 --> 0:05:07.919 When the US went into Iraq. The example was Saddam 0:05:08.000 --> 0:05:13.480 Hussein borrowing hundreds of billions of dollars to buy arms, 0:05:13.560 --> 0:05:18.240 and those arms were then used to oppress the Iraqi people. 0:05:18.800 --> 0:05:24.560 So that that that is the popularized version of this 0:05:24.640 --> 0:05:29.919 odious debt concept you mentioned. Okay, so we can understand 0:05:30.000 --> 0:05:34.919 easily enough this idea that if a despotic leader borrows money, 0:05:35.240 --> 0:05:37.840 prep doesn't use the money in service of the public, 0:05:37.920 --> 0:05:41.440 and then after they go it uh see, it's odious 0:05:41.520 --> 0:05:43.799 the idea that the public would then have to bear 0:05:43.839 --> 0:05:47.040 the cost of that debt. How much is in the 0:05:47.080 --> 0:05:50.680 determination or the thinking of when debt is odious? How 0:05:50.760 --> 0:05:53.840 much or how difficult is it or how important is 0:05:53.880 --> 0:05:57.440 it to establish that the lender understood this that when 0:05:57.440 --> 0:06:00.560 they were lending that when someone bought the foreign debt 0:06:00.720 --> 0:06:04.279 of a given country, that they were buying into debt 0:06:04.480 --> 0:06:07.760 that really was not going to help the public in 0:06:07.760 --> 0:06:15.279 any way. So usually the lender is not really analyzed 0:06:15.360 --> 0:06:21.719 in these discussions of odious debts. Almost every discussion of 0:06:21.760 --> 0:06:27.480 odious debts. For example, take the Saddam Huseyne case, which 0:06:27.600 --> 0:06:30.120 is you know, the most recent a lot of the 0:06:30.160 --> 0:06:34.880 debts there were literally arms dealers selling arms to Saddam, 0:06:35.600 --> 0:06:40.400 but the primary focus was on the despotism of the 0:06:40.520 --> 0:06:43.680 leader of Saddam. It's really only in a case like 0:06:43.920 --> 0:06:48.880 Haiti and sort of more broadly colonial or imperial debts 0:06:49.920 --> 0:06:54.360 that you begin to think about the lender. And that's 0:06:54.440 --> 0:06:59.160 not something that we have traditionally done. So I want 0:06:59.160 --> 0:07:04.000 to get into the exact situation with Haiti and the 0:07:04.080 --> 0:07:07.400 money involved, but before we do, you know, we're talking 0:07:07.440 --> 0:07:12.760 about a broad definition of odious debt that really focuses 0:07:13.080 --> 0:07:16.760 on the borrower. And as you mentioned, the classical example 0:07:16.960 --> 0:07:20.200 is a despot who borrows lots of money that doesn't 0:07:20.240 --> 0:07:27.400 necessarily benefit their country's population. How did that particular interpretation 0:07:27.600 --> 0:07:31.960 of odious debt come into being because in some ways, 0:07:32.040 --> 0:07:37.840 like it seems very very um defined and specific. So 0:07:38.120 --> 0:07:40.800 this is an interesting question that you ask, And you know, 0:07:40.840 --> 0:07:43.920 I've been working on this, and Ugo probably has a 0:07:43.960 --> 0:07:46.680 different perspective, but he's also been working on this for 0:07:46.720 --> 0:07:50.800 a long time. We worked together on a debts incurred 0:07:50.800 --> 0:07:56.080 by Nicolas Maduro in Venezuela, and sort of I always 0:07:56.120 --> 0:07:58.000 took it for granted that, you know, if you have 0:07:58.000 --> 0:08:02.880 a despotic leader borrowing the future governments, especially if they're 0:08:03.320 --> 0:08:07.000 you know, democratic governments, they shouldn't be burdened by this debt, 0:08:07.120 --> 0:08:12.080 and it sort of seemed natural and logical and sensible, 0:08:12.480 --> 0:08:16.040 and I didn't think about it. It seemed right until 0:08:17.160 --> 0:08:21.360 I started working with Hugo and or other two co 0:08:21.480 --> 0:08:27.160 authors about the Haitian debt, And in that context, one 0:08:27.200 --> 0:08:31.160 of our other co authors, Mark Widermer, started asking the 0:08:31.280 --> 0:08:35.920 question of you know, why have we framed this doctrine 0:08:36.040 --> 0:08:41.840 in this particular fashion. And my best guests from the 0:08:42.000 --> 0:08:47.080 literature and talking to anthropos social anthropologists who studied this 0:08:47.600 --> 0:08:53.160 in more detail, is that it's a product of the 0:08:53.320 --> 0:08:57.760 interests who created this doctrine. Now, this is a doctrine 0:08:57.800 --> 0:09:01.880 that was created by the U. S State Department in 0:09:02.280 --> 0:09:06.760 the late eighteen hundreds after the Spanish American War. They 0:09:06.760 --> 0:09:10.840 didn't want to pay the debts that had been incurred 0:09:11.679 --> 0:09:15.400 by Spain using Cuba as collateral, and so they said, 0:09:15.440 --> 0:09:19.000 you know, you were despotic leader leaders putting down an 0:09:19.040 --> 0:09:23.800 independence movement. And then the US again in UM two 0:09:23.800 --> 0:09:28.240 thousand three two four, does not want to pay Saddam 0:09:28.360 --> 0:09:34.040 Hussein's debts. So the rejuvenation of the odious debt doctrine 0:09:34.080 --> 0:09:38.320 again is in the context of a despotic leader, but 0:09:39.480 --> 0:09:43.040 it never really touches colonial debts, where the leaders are 0:09:43.080 --> 0:09:46.440 not quite as despotic and much more complicated, in part 0:09:46.559 --> 0:09:50.960 because the countries and the scholars who pushed this doctrine, 0:09:51.000 --> 0:09:54.600 we're pushing it in a particular context. I don't know, Hugo, 0:09:54.679 --> 0:09:57.920 if you you have a different view, I mean I am. 0:09:57.960 --> 0:10:00.800 I am a former colonial s object then grew up 0:10:00.800 --> 0:10:04.480 in the Caribbean, so I have a particularly jaundiced view 0:10:04.520 --> 0:10:08.200 of all of this. I mean, there is also another aspect. 0:10:08.240 --> 0:10:11.680 So there is the aspect from let's say the Angio movements, 0:10:12.240 --> 0:10:14.800 you know, kill the debt and all this sort of stuff, 0:10:14.840 --> 0:10:19.120 and these people would like to cancel all sorts of death. 0:10:19.720 --> 0:10:22.600 So there is a more I don't know, leftist if 0:10:22.600 --> 0:10:26.079 you want to call it this way perspective, right, and 0:10:26.120 --> 0:10:29.679 there there is a debate asked me to say it. 0:10:30.000 --> 0:10:33.959 It seems reasonable that when somebody borrows to oppress its 0:10:34.000 --> 0:10:37.560 own people this that should not be enforceable. But then 0:10:37.600 --> 0:10:40.120 if you talk with market people, they tell you where 0:10:40.200 --> 0:10:43.959 you draw the line, right, It's like where where does 0:10:44.000 --> 0:10:46.840 the guy become a deskpot? And some people say, if 0:10:46.840 --> 0:10:50.000 you start going there, then nobody will ever learn to 0:10:50.080 --> 0:10:54.000 any country because you know, no countries a perfect democracy. 0:10:54.040 --> 0:10:56.520 So these other there is this other dimension. So some 0:10:56.559 --> 0:10:59.839 people said that maybe you should have an expanted that 0:11:00.160 --> 0:11:03.480 rational of obviousness. Right. So there is a famous paper 0:11:03.559 --> 0:11:08.600 by malcol Michael Kramer and C. Chandra which says, you know, 0:11:09.280 --> 0:11:12.680 at some point the official sector, my or the UN 0:11:12.800 --> 0:11:16.080 or whatever might declare this country's audious and from this 0:11:16.120 --> 0:11:19.920 moment on that contracted by this person by this country 0:11:19.960 --> 0:11:22.240 will not be enforceable. So there is a big also 0:11:22.320 --> 0:11:26.880 discussion on this exanta versus expost, which is different from 0:11:26.960 --> 0:11:30.280 the high heat case that we're talking about here. What 0:11:30.360 --> 0:11:35.800 do you walking through the basic contours of the Haiti situation, 0:11:36.160 --> 0:11:38.800 the numbers, the claims, just sort of like give us 0:11:38.880 --> 0:11:43.440 the sort of like basic summary of the colonial debt 0:11:43.480 --> 0:11:46.080 that was incurred, why the debt was incurred, how much 0:11:46.120 --> 0:11:49.280 it was and so forth. Okay, so I'll begin with 0:11:49.400 --> 0:11:53.959 the easy part the story, which is wonderful, and then 0:11:54.000 --> 0:11:58.160 I'll give google the boring part about the numbers that 0:11:58.400 --> 0:12:02.280 in the end are much more important. So I think 0:12:02.360 --> 0:12:06.240 it's a bit embarrassing. Ugo and I both consider ourselves 0:12:06.280 --> 0:12:10.200 scholars of international debt and have been doing this for 0:12:10.520 --> 0:12:15.040 at least two decades, and neither of us had really 0:12:15.080 --> 0:12:22.400 paid any attention to the Haitian independence debt of eighteen five. 0:12:22.920 --> 0:12:25.480 We it just seemed like this old, obscure thing we 0:12:25.520 --> 0:12:29.920 hadn't really heard of. It didn't seem relevant to most 0:12:29.920 --> 0:12:36.160 of what we did until this last semester last year. Really, 0:12:37.160 --> 0:12:42.800 when COVID hits and we decide in our classes, you know, 0:12:42.920 --> 0:12:45.840 maybe this is time to focus on some of the 0:12:45.920 --> 0:12:48.599 poorer regions around the world and see what's going to 0:12:48.760 --> 0:12:54.079 happen if they're really hit bad by COVID and they 0:12:54.160 --> 0:12:59.079 need to think about what kind of financial recoveries can 0:12:59.160 --> 0:13:02.320 we get. Some of my students in my Sovereign Debt 0:13:02.320 --> 0:13:06.440 class find this Haitian independence dead of eighteen twenty five, 0:13:06.880 --> 0:13:08.880 and I want to dismiss it because it is not 0:13:09.000 --> 0:13:11.880 what I had planned that we would work on in 0:13:11.920 --> 0:13:15.920 the class. And then I started looking at it and 0:13:16.040 --> 0:13:19.199 started talking to Ugo and our other co authors about it, 0:13:19.880 --> 0:13:26.040 and it's astounded. So in eighteen twenty five, Haiti has 0:13:26.080 --> 0:13:30.600 a debt imposed on it by France. France sends a 0:13:30.640 --> 0:13:34.200 bunch of gun boats. I think there were fourteen gun 0:13:34.240 --> 0:13:39.720 boats with five hundred guns pointed at the Haitian capital, 0:13:40.559 --> 0:13:45.360 and France says to the Haitian people, look, we are 0:13:45.400 --> 0:13:50.960 willing to recognize you as independent. Haiti had fought a 0:13:51.040 --> 0:13:55.600 bloody revolution against France and one its independence in eighteen 0:13:55.640 --> 0:14:00.000 o four. So two decades prior, the French under Napole 0:14:00.000 --> 0:14:03.080 Lion had tried to take back Hadi. They had failed. 0:14:04.200 --> 0:14:07.320 And then finally in eight and this is after the 0:14:07.360 --> 0:14:11.119 Louisiana purchase, France sort of decides, you know, no more colonies, 0:14:11.800 --> 0:14:13.600 at least in that part of the world. It's just 0:14:13.640 --> 0:14:18.080 too expensive when you keep losing, and so they try 0:14:18.120 --> 0:14:22.840 to negotiate with Haiti. We will give you your independence, 0:14:22.880 --> 0:14:26.480 We will recognize you as independent if you pay us 0:14:26.920 --> 0:14:30.320 a hundred and fifty million francs. Now, to get some 0:14:31.040 --> 0:14:34.840 sense of how much this is, and we go will 0:14:34.880 --> 0:14:39.040 hopefully talk about what fraction of hades revenues it was 0:14:39.120 --> 0:14:42.760 at that time. But the Louisiana purchase was about fifteen 0:14:42.800 --> 0:14:46.120 million francs. This is a hundred and fifty million francs 0:14:46.320 --> 0:14:50.520 they impose on Haiti with the gunboats pointed at them, 0:14:50.640 --> 0:14:55.120 and the calculation of this amount the historical record is 0:14:55.160 --> 0:15:01.080 not completely clear, but basically, the French King Charles needed 0:15:01.120 --> 0:15:07.240 this money to pacify the former plantation owners and their 0:15:07.520 --> 0:15:12.840 estates in France, and calculations were made based on the 0:15:12.920 --> 0:15:17.600 amount of loss that they suffered, specifically in terms of 0:15:17.920 --> 0:15:21.200 the number of slaves who went free as a result 0:15:21.920 --> 0:15:26.760 of the revolution. So that's the basic that's that's the 0:15:26.840 --> 0:15:29.760 debt that was imposed on Haiti. Haiti doesn't pay it 0:15:29.800 --> 0:15:33.640 back for almost a century, actually more than a century, 0:15:33.960 --> 0:15:37.600 and much of Haitian borrowing in the next century is 0:15:37.800 --> 0:15:41.720 just to pay back this extremely large debt that they 0:15:41.760 --> 0:15:45.640 owe to friends. Now in terms of specific numbers, um 0:15:45.640 --> 0:15:49.840 I leave that to UGO, so maybe they we don't 0:15:49.880 --> 0:15:56.320 have good estimates for GDP at that period and or revenues, 0:15:56.720 --> 0:16:00.840 but whatever estimates we have suggested this amount about ten 0:16:00.960 --> 0:16:04.520 years worth of revenue, so it's a very large number 0:16:05.400 --> 0:16:11.720 and or about three times situs GDP based on on 0:16:11.880 --> 0:16:15.880 the on the numbers that that we have now. So 0:16:15.920 --> 0:16:18.840 they were very very large numbers. And and that's me 0:16:18.920 --> 0:16:38.680 to say it's more more than the Louisiana purchase. So 0:16:38.920 --> 0:16:42.280 can we maybe talk a little bit more about why 0:16:42.480 --> 0:16:47.040 Haiti agreed to pay the indemnity? So, you know, you 0:16:47.120 --> 0:16:51.040 mentioned there were gunboats um pointed at porter of Prince, 0:16:51.200 --> 0:16:55.360 which seems quite threatening. But on the other hand, Hadi 0:16:55.600 --> 0:16:58.880 did get something out of it. And I'm sort of 0:16:58.960 --> 0:17:03.680 playing devil's advocate here, but they did get their independence 0:17:03.880 --> 0:17:07.560 recognized by France, even though they were essentially, you know, 0:17:08.240 --> 0:17:12.280 buying their freedom from slavery, which is terrible, but they 0:17:12.320 --> 0:17:16.240 got the recognition from France. That led to further recognition 0:17:16.359 --> 0:17:20.600 from places like Britain, um that opened up trade relationships 0:17:20.680 --> 0:17:23.479 and things like that. Is there an argument to be 0:17:23.560 --> 0:17:29.160 made that this can't be considered odious because the population, 0:17:29.440 --> 0:17:33.800 you know, got something out of the agreement. So you're 0:17:33.920 --> 0:17:41.919 asking the really tough question. Haiti arguably itself proposed that 0:17:42.000 --> 0:17:45.320 it would pay something to France. Now they didn't propose 0:17:45.400 --> 0:17:48.919 this incredibly large amount. They were thinking more along the 0:17:48.960 --> 0:17:51.960 lines of the Louisiana purchase, and that would have still 0:17:52.000 --> 0:17:54.800 been at least half their GDP for the year, but 0:17:55.760 --> 0:17:59.440 perhaps manageable. Haiti at that point in time was one 0:17:59.440 --> 0:18:01.439 of the rich as parts of the world, which is 0:18:01.560 --> 0:18:05.000 why France was so desperate to hold onto it. They 0:18:05.040 --> 0:18:09.119 they were a huge source of French revenues at the 0:18:09.320 --> 0:18:14.760 at that point in time. But the legal question of 0:18:14.960 --> 0:18:20.879 whether or not Haiti could be charged by France for 0:18:20.960 --> 0:18:28.680 a recognition or be independence or see for the slaves 0:18:28.920 --> 0:18:33.879 fighting a revolution and becoming independent um is quite complicated. 0:18:34.800 --> 0:18:38.960 It's not at all clear, at least in our research, 0:18:39.640 --> 0:18:43.040 whether or not at that point in time it was 0:18:43.119 --> 0:18:49.919 acceptable under international law for countries new countries to be 0:18:50.080 --> 0:18:55.000 charged for somebody else recognizing them. The law is quite murky. 0:18:55.119 --> 0:18:57.920 Now we know it happened, but whether it was legally 0:18:58.119 --> 0:19:03.480 kosher is not year. Can you charge a new country 0:19:03.600 --> 0:19:09.359 for it becoming free and fighting a revolution? Again, not 0:19:09.560 --> 0:19:14.240 at all clear, and then it's not clear either that 0:19:14.320 --> 0:19:18.080 we would apply the laws and norms of that time 0:19:18.760 --> 0:19:24.119 or whether we would apply modern conceptions of human rights, 0:19:24.200 --> 0:19:27.560 where you know, making a d pay for the freedom 0:19:27.600 --> 0:19:31.400 of the slaves clearly wouldn't be acceptable. Yeah, maybe just 0:19:31.440 --> 0:19:35.919 a mol anecdote that for the first fifteen years after independence, 0:19:36.560 --> 0:19:39.520 Haiti was actually split in two countries, with the with 0:19:39.640 --> 0:19:43.840 the president in the south and the king in the north. 0:19:44.400 --> 0:19:48.040 So the president was which was called the Pekion, was 0:19:48.080 --> 0:19:51.600 the first one to sort of propose paying some inmdernity, 0:19:51.680 --> 0:19:53.800 but again, as me too said, he had in mind 0:19:55.080 --> 0:19:58.160 a much smaller amount, while the king in the north 0:19:58.320 --> 0:20:04.399 was always opposed to it. So the idea that a 0:20:04.480 --> 0:20:09.040 country would have to pay uh It's former colonial master 0:20:09.280 --> 0:20:14.320 for recognition, to pay this extraordinary sum to essentially escape, 0:20:14.760 --> 0:20:19.720 you know, depart from slavery. Obviously, it's you know, it's grotesque, 0:20:20.080 --> 0:20:23.280 it's awful. Why is it important, or you know, at 0:20:23.359 --> 0:20:27.240 least intuitively it is. Why is it important to fold 0:20:27.320 --> 0:20:30.879 it into the odious debt literature because obviously the contours 0:20:30.920 --> 0:20:35.480 of it, well being I guess objectively and were morally odious, 0:20:35.520 --> 0:20:39.080 are different than the sort of conception of the conception 0:20:39.080 --> 0:20:41.040 that we talked about in the beginning of a Despot. 0:20:41.520 --> 0:20:45.240 Why is it important today in sort of the establishment 0:20:45.440 --> 0:20:48.720 of the study of odious debt to weave that in 0:20:48.880 --> 0:20:53.720 as opposed to thinking of it as its own distinct concept. 0:20:53.800 --> 0:20:57.399 What does that get? What does that accomplish? So again 0:20:57.880 --> 0:21:03.600 you're asking an extreme, the good question and a tough one. 0:21:04.600 --> 0:21:09.600 Here's my take on this. The the odious debt movement 0:21:12.080 --> 0:21:16.560 is a powerful one. Just the rhetoric of that movement 0:21:17.280 --> 0:21:22.000 has a has had a lot of sway with NGOs, 0:21:22.280 --> 0:21:28.440 with academics in the popular press. So to get this 0:21:28.640 --> 0:21:33.920 debt that has really not gotten much attention, the Haitian 0:21:33.960 --> 0:21:39.679 independence debt of you ask anybody in Haiti, they know 0:21:39.760 --> 0:21:43.120 about it, they think about how many billions they are owed. 0:21:43.400 --> 0:21:48.680 But ask people outside of Haiti, scholars who study this, 0:21:49.280 --> 0:21:53.040 ask people in France, anywhere else in the world, they 0:21:53.080 --> 0:21:57.000 have no idea about this. To bring it into the 0:21:57.040 --> 0:22:02.240 odious debt framework, and and this is as odious of 0:22:02.240 --> 0:22:07.240 a debt that we've ever had in history, I think 0:22:07.760 --> 0:22:13.240 could give power, rhetorical power to the movement to get 0:22:13.320 --> 0:22:18.600 some kind of compensation paid, but also would open the 0:22:18.640 --> 0:22:24.520 door to other similar colonial debts that have not been 0:22:24.760 --> 0:22:28.520 included in the odious debt discussions. So that, I mean, 0:22:28.880 --> 0:22:31.800 this goes back to the question that Tracy started with, 0:22:32.720 --> 0:22:36.240 which is, you know, how is it that the odious 0:22:36.320 --> 0:22:41.920 debt discussions really have been very limited to these despotic 0:22:42.080 --> 0:22:46.520 leaders and whether or not sort of Western creditors will 0:22:46.560 --> 0:22:49.520 get paid back on their bonds when there are all 0:22:49.640 --> 0:22:56.400 sorts of other stinky debts around the world, particularly colonial debts. 0:22:56.840 --> 0:23:01.040 I mean, think of King Leopold of Congo. He borrowed 0:23:01.280 --> 0:23:05.280 heavily on the international debt markets and then you know, 0:23:05.440 --> 0:23:10.040 basically committed genocide in the Congo. There's no discussion of 0:23:10.720 --> 0:23:13.960 you know, those debts. But but this one is is 0:23:14.040 --> 0:23:18.720 a this one is among the really just the stinkiest 0:23:18.760 --> 0:23:23.440 of those to my mind me too. You mentioned, um 0:23:23.640 --> 0:23:28.440 the rhetoric of odious debt being a powerful influence, and 0:23:28.920 --> 0:23:32.120 I think here it's really important that we mentioned that 0:23:32.160 --> 0:23:34.640 even though there's been a lot of talk about Odia's debt, 0:23:35.240 --> 0:23:39.399 it hasn't actually been um, sort of acted upon in 0:23:39.440 --> 0:23:43.520 any real way. So the Iraqi debt that you mentioned earlier, 0:23:43.560 --> 0:23:46.399 and we actually recorded an episode a while back with 0:23:46.480 --> 0:23:48.880 Simon Hendrickson, who did some really great work on this. 0:23:49.520 --> 0:23:53.120 The Iraqi debt situation was basically the closest the world 0:23:53.240 --> 0:23:57.120 ever got to actually acting on the principle of odious 0:23:57.160 --> 0:24:02.080 debt and negating some borrowings under Saddam Hussein, But it 0:24:02.119 --> 0:24:07.479 didn't actually happen. So I guess two questions, Why hasn't 0:24:07.480 --> 0:24:10.160 it happened yet if everyone's talking about it so much? 0:24:10.200 --> 0:24:15.120 And then secondly, what good is talking about odious debt 0:24:15.240 --> 0:24:21.520 if it never actually comes to fruition. So I'll use 0:24:21.560 --> 0:24:26.400 the Iraqi example. You guys had a great episode with Simon, 0:24:27.480 --> 0:24:33.320 and just drawing from Simon's work, discussing the Iraqi debt 0:24:33.440 --> 0:24:36.399 in terms of its odious nous was part of the 0:24:36.520 --> 0:24:41.400 strategy of the legal team there, and they knew they 0:24:41.400 --> 0:24:46.440 didn't have a leg to stand on if they actually 0:24:46.520 --> 0:24:49.760 had to go to court and try to argue that 0:24:49.840 --> 0:24:53.520 this doctrine existed. Now, there are legal scholars who argue 0:24:53.600 --> 0:24:58.679 that as a matter of customary international law, such a 0:24:58.720 --> 0:25:02.840 doctrine has evolved. Alved I am skeptical that you could 0:25:03.440 --> 0:25:06.640 actually persuade a court to do that, but the rhetoric 0:25:06.800 --> 0:25:13.040 of odious debt was powerful enough that the negotiators for 0:25:13.280 --> 0:25:18.040 Iraq were able to get in the Paris Club the 0:25:18.160 --> 0:25:22.800 biggest write down of debt ever in history. I mean 0:25:22.800 --> 0:25:26.840 it was something like a right down of debt. And 0:25:27.000 --> 0:25:31.679 it was because at least in part, that they clothed 0:25:31.760 --> 0:25:35.520 it in the rhetoric of odious debt. I mean, now, 0:25:35.960 --> 0:25:41.480 they did it brilliantly. I mean they got everyone basically 0:25:41.560 --> 0:25:46.119 to agree to take this massive write down because nobody 0:25:46.160 --> 0:25:51.240 wanted exposure of what had actually happened. And if we 0:25:51.320 --> 0:25:55.600 go back in time to the strategy that the lawyers 0:25:56.320 --> 0:26:00.800 for Haiti had planned in two thousand, between two thousand 0:26:00.800 --> 0:26:04.800 two and two thousand four, this was exactly what they 0:26:04.840 --> 0:26:07.400 had in mind. They I don't think they thought they 0:26:07.480 --> 0:26:11.680 really had much of a chance of sort of winning 0:26:11.760 --> 0:26:15.200 a legal case, but they wanted to get into court. 0:26:15.359 --> 0:26:19.320 And once they got into any kind of international jurisdiction 0:26:19.880 --> 0:26:24.640 and they got a hearing, then the atmospherics of how 0:26:24.720 --> 0:26:27.320 bad this was was going to be on their side. 0:26:27.440 --> 0:26:31.359 So that's a long winded answer to why this could 0:26:31.400 --> 0:26:37.720 have really practical consequences. Can I add something crazy? I'm 0:26:37.760 --> 0:26:41.520 you know, I'm by nature optimistic, and I remember one 0:26:41.560 --> 0:26:45.840 episode and so if you remember around the in the nineties, 0:26:45.880 --> 0:26:50.320 there were people campaigning for for multilateral debt relief, and 0:26:50.400 --> 0:26:54.080 basically the position of the you know, US administration and 0:26:54.280 --> 0:26:57.000 that ate at that point was that this is never 0:26:57.000 --> 0:26:59.320 going to happen. And then at some point it just 0:26:59.400 --> 0:27:01.560 happened it and the you know, the White House was 0:27:01.600 --> 0:27:03.880 on board, and the people who were on board were 0:27:03.920 --> 0:27:06.840 exactly the same people who two or three years before 0:27:06.840 --> 0:27:08.679 I said this is never gonna happen. The you know, 0:27:08.760 --> 0:27:11.399 the the World Bank is never going to cancel that 0:27:11.960 --> 0:27:15.639 or by lo income countries. So in a sense, maybe 0:27:16.280 --> 0:27:19.159 you know, preparing the ground, the sort of building a 0:27:19.240 --> 0:27:22.480 case for something that you think is right, maybe at 0:27:22.480 --> 0:27:26.199 some point things can change. So I also see it 0:27:26.240 --> 0:27:29.920 is in this sense. But but but met always thinks 0:27:29.920 --> 0:27:49.040 that I'm I'm a dreamer. Can we go if we 0:27:49.320 --> 0:27:52.600 go back to the details of Haiti. I mean, you 0:27:52.680 --> 0:27:58.080 mentioned the stats are not particularly reliable from that time, 0:27:58.160 --> 0:28:02.399 but maybe the debt was years worth of total total 0:28:02.520 --> 0:28:06.119 revenue for the country at the time. And as you mentioned, 0:28:06.400 --> 0:28:08.760 it's still talked about today and we taught and as 0:28:08.800 --> 0:28:12.680 Tracy and I discussed in the intro, Haiti is obviously 0:28:12.760 --> 0:28:16.320 one of the poorest countries is known and under you know, 0:28:16.480 --> 0:28:18.199 people think of it as one of the poorest countries 0:28:18.240 --> 0:28:22.359 in the region. How much did that debt contribute to 0:28:22.600 --> 0:28:27.840 the economic trajectory, the poor economic trajectory of Haiti some 0:28:28.000 --> 0:28:30.600 nearly two hundred years ago, or about two hundred years ago, 0:28:31.040 --> 0:28:36.120 how much did that contribute to the economic and sort 0:28:36.160 --> 0:28:39.200 of disaster that Haiti is known to be all these 0:28:39.240 --> 0:28:42.880 years later. So so we did a bunch of backup 0:28:43.040 --> 0:28:47.400 of the envelope exercises. Some exercises are trying aimed at 0:28:47.400 --> 0:28:50.920 trying to estimate how much this money would be worth today. 0:28:51.040 --> 0:28:55.520 And another exercise is exactly focused on your question, Joe, 0:28:55.680 --> 0:28:59.600 how much of the audible growth performance of of a 0:28:59.680 --> 0:29:02.920 height year over the past to two years can be 0:29:03.080 --> 0:29:07.240 attributed to this death. I'll tell you about the numbers. 0:29:07.240 --> 0:29:10.680 But before that, there is a document in in in 0:29:11.080 --> 0:29:13.600 a the classified document in the archives of the i 0:29:13.800 --> 0:29:16.680 m F. And this is a report about of a 0:29:16.760 --> 0:29:20.280 mission to a hitty in So the IMF must have 0:29:20.320 --> 0:29:22.920 been one or two year old. And let me use 0:29:22.960 --> 0:29:25.760