ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Debt Where Credit Is Due

Andre Gunder Frank The reparations transfer out of Germany after its First World War defeat reached a maximum of perhaps 3.5 per cent of GNP and 15 per cent of export earnings in the darkest years of 1929-31. In his "The Economic Consequences of the Peace", Keynes warned that this drain would be unsustainable for Germany and counterproductive for the world. He was proven right by the resultant rise of Hitler Yet many Third World countries are today being drained at 5 and 6 per cent of their GNP and 30 to 50 per cent and more of their export earnings annually through the resource transfer of their debt service. And despite this enormous hemorrhage of the Third World, most proposals to deal with the Third World debt crisis propose to further increase the debt now and debt service later even more.

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