If You Read Nothing Else Today, Read THIS: Vulture Funds

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We’ve all thought about global problems like poverty, HIV/AIDS, genocide, famine, and we’ve all wondered what on earth we could possibly do to help. Well, fellow bloggers, let’s just see what we can do about a truly vile and reprehensible practice called vulture funds. Like vultures circling the dying, huge corporations and conglomerates buy up the debt of a third world or otherwise economically struggling country at a fraction of its worth, only to turn around and sue that country for the full amount plus interest.

Sound like good business sense to you? Hmmmm. Maybe. If you are capable of looking at this from a strictly detached and business-minded perspective. Because what it really means, in the real world, is that already poor and struggling nations don’t have the promise of debt relief, rather they have to pay back many times over the debt they believed themselves to be relieved of. And we all know where huge sums of money come from in countries, including our own . . . schools and hospitals, among other vital aspects of a nation’s infrastructure. People literally die because of this practice; they don’t receive medicine they need or medical care that’s no longer and may never again be available. So it’s not exactly good business sense if it means that the already impoverished and suffering are being exploited so the rich can get richer. Money for quality of life . . . for life itself.

The most recent case of this happened in Zambia, where Donegal International sued Zambia for $42 million. Keep in mind that Donegal International itself paid only $4 million for Zambia’s debt, and the judge is expected to award Donegal “only” $10 to $20 million rather than the forty-two they asked for. So that’s a real victory for Zambia, right? Um. Hardly. Zambian assets, according to the linked BBC article, are frozen. Can you imagine? Do you have any idea how absolutely outraged and boiling over I am at all this? And my very favorite comment in the whole article is from the spokesman for Donegal International who says he has “no comment” and that the debt is not his debt. Well, then, clearly not of any import at all, right? Wash hands. Move on.

Or not. Instead of just shrugging and washing our hands, why don’t we actually DO something out here in blogland? Why don’t we follow, as I am in this blog, the lead of Simon and Kerry and get the word out, their blogs have still more information than I’ve written here; at the very least sign petitions? If you’re English, Simon has the Number 10 links for you to sign, and otherwise, check with Kerry, who’s created a petition at ipetition: both of these petition links are provided below, as well.

There has to be other things we can do . . . sit on your behind, and do something; for once that makes sense! Email your U. S. House of Representatives, email your U. S. Senator (if you’re not in the U. S., google your government officials, but if you’re in England, see Simon’s page for relevant links).

Has anyone even heard of this outside of blogland? Why not? Why are we being inundated with “news” (so-called) of Anna Nicole Smith’s death, burial, etc., but we don’t hear about this very sick and immoral and ten kinds of wrong practice that is essentially kicking countries and peoples when they are down and then holding them down to ensure they never get up again? So don’t stop at your government officials; contact your local media, email CNN’s “news tips” or 60 Minutes or whatever media outlet you believe should be covering this travesty.

You don’t have to leave the couch or your chair to make a difference, a real difference in real people’s lives. Vulture funds MUST be stopped, and here at last, is our opportunity to do something good and decent rather than just blogging about it.

Sign a petition NOW:

Anyone: http://www.ipetitions.com/petition/stopvulturefunds/

British citizens (and I think people living in the UK, as well): http://petitions.pm.gov.uk/vulturedebt/

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Related links:

For an entertaining “primer” on vulture funds (a blog): http://sanfrancisco.tribe.net/listing/Your-Vulture-Fund-Primer-has-arrived-an…

A link to many articles and further information on vulture funds in general and the Zambia case in particular (courtesy of my friend Michael): http://www.thirdworldtraveler.com/Global_Secrets_Lies/Vulture_Funds.html

A must read on vulture funds and Zambia, includes detailed notes: http://www.oxfam.org.uk/applications/blogs/pressoffice/2007/02/vulture_fund_m…

Another blog about vulture funds (courtesy of Simon, see comments below): http://no-dictator-needed.blogspot.com/2007/02/vulture-funds-and-robbing-of-p… And the source of the article this blog contains: http://www.suntimes.com/news/jackson/263601,CST-EDT-jesse20.article

Link to Greg Palast, the BBC investigative reporter whose fifteen minute segment on Newsnight is discussed and available on vid here: http://www.gregpalast.com/vulture-fund-threat-to-third-world/

For a transcript of the aforementioned television segment (you’ll need to scroll down the page to get to it): http://www.democracynow.org/article.pl?sid=07/02/15/1528209

More from Greg Palast regarding Amnesty International (courtesy of Rii, see comments below): http://www.gregpalast.com/amnesty-loses-face/

For an article about vulture funds exploitation of Argentin
a: http://www.larouchepub.com/other/2003/3039vultur_fnds.html

For an article abou
t vulture funds exploitation of Peru: http://www.greenleft.org.au/2000/426/22461

In defense of vulture funds (blogs): http://www.felixsalmon.com/000667.html and (courtesy of Simon, see comments below) http://teawithft.blogspot.com/2007/02/vulture-funds.html

Vulture funds and oil companies article (a response to the felixsalmon blog above): http://www.salon.com/tech/htww/2007/02/27/vulture_funds_2/index.html?source=rss

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25 thoughts on “If You Read Nothing Else Today, Read THIS: Vulture Funds

  1. Fuzzy…I need to learn more about this.
    It sounds more like “Loan Shark” practices.
    Something just does not sound “right.”
    I think there must be more behind the door politics than meets the eye….more lining of the pockets than meets the eye….and I am refering to both parties of the transaction.
    Will get back to you later.

  2. As you’re looking into this, Rainy, will you let me know what you find? I’m particularly interested in the legalities of this; I can’t imagine why no lawyer for the countries in question don’t just write in a line or two forbidding future lawsuits . . . that part makes no sense to me. And yes, I’m sure LOADS of people are profiting, but one thing seems rather clear, and that’s that these countries are being exploited and badly. Thanks for reading about it here AND for finding out more . . . again, please please share what you learn. Huggs to you, Wonderful Rainy xx

  3. wonderfully written, fuzzy! if i didn’t already know anything about this, reading your blog would definitely move me to action. thank you.

  4. Hei Fuzz.

    Yes, the masses are fed a steady diet of useless tripe while the real news is kept hidden out of sight, out of mind! I know quite a bit of these menacing ways of practice in the name of ‘law’ – such an opposite term for what it actually is.

    It is in the Sheriff of Nottingham-fashion of robbing the poorest of the poor in order to make the insanely richest even richer.

    Questions do rise like:
    1. How come these courts and their judgements are held in the the so called civilized west?
    2. Why are the churches and other such like so very silent on this practice?
    3. Why is Amnesty et cetera silent? I do not hear them ‘scream’ of this injustice? http://www.gregpalast.com/amnesty-loses-face/

    GREAT blog, Fuzz. Will keep on checking this out in detail. Rii xx

  5. Ive just been and signed the petition at Downing Street for the PM from Simon’s page. I never even realised this stuff goes on as I am not one for reading a paper as you know or watching the news. I can’t believe the judge ruled in their favour but then again if thats the law, that does need changing!

  6. So many questions – so little time šŸ˜‰

    The original debt was when the Romanian Government arranged a loan for Zambia to buy Romanian tractors. In my reading it has been suggested that the tractors were not that good, but in the ned it is just one of those little ironys.

    The deal was done in 1979. Back then there was the strange idea that the Europeans would drop their farm subsidies and by investing in agriculture, Zambia would be in a position to earn hard currency by exporting farm products.

    Neither the EW or America dropped their farm subsidies – and it doesn’t look like they will anytime soon.

    In 1999, when it was clear that Zambia was having difficulty repaying the debt, the Romanian Government and Zambia agreed to write it off for a $3m payment from Zambia.

    That was when Debt International bought the debt for under $4m.

    There is more detail to this and other national debt bought by Vulture Funds at :- http://no-dictator-needed.blogspot.com/2007/02/vulture-funds-and-robbing-of-poor.html

    The question of why there is apparent silence amongst a lot of the interest groups is interesting. Certainly a lot of the news organisations don’t seem to be carrying the story. There are some interesting theories doing the rounds about lobbying and polytical clout. It could be that a lot of the media companies are also heavily debt leveraged?

    Whatever the reason there isn’t a lot of information out there. The companies are secretive, the court cases are not getting publicity and the politicians don’t talk about it much.

    There don’t seem to be many people speaking up for the Vulture Funds – but I found one.

    http://teawithft.blogspot.com/2007/02/vulture-funds.html

    The worrying thing about this guy being that it seems he once had something to do with the World Bank.

  7. Thanks for bringing this to my attention. We all know that grass roots action does make a difference. Thanks for starting this ripple. I’ll put you on my blast…

  8. Well done Fuzzy, I will put this in the blast too. I was working for a company they were investing money in swiss banks, all the major banks invest also. They get interest paid every month, 40 to 80% depending on the amount. When asked how they are earning this money, this is how Vulture funds, give loans to poor governments and charge a hell lot. Every top bank in the country is involved in this. They are just squeezing the poor out.

  9. Our world is full of greedy people who exploit the poor and that makes me sick. I had not heard about vulture funds until now.
    I can’t believe that someone hasn’t made this known before. Maybe as you said; all we hear about is Anna Nicole Smith etc. So very sad.

  10. Not a popular feeling, but I have enough to think about within my own borders both in the US and UK without looking outside of them. I reckon we need to take a closer look at home before worrying about abroad. Like I said, not a popular way to feel but my opinion nonetheless.

  11. fantastic blog Fzy!
    Subscribe to Oxfam so had heard of these wanker investment companies but it was only after the BBC programme that it has made an impact albiet small in mine and other peoples minds and sense of justice.
    somebody mentioned ‘thinking within our borders?’..bloody hell…on this particular issue thats nonsense.
    Our goverments,using public money,our money,are helping third world countries to sort out their debts and economical problems,some of which is self inflicted,i agree, but some of which is caused and driven by selfish western economic measures..so that ‘we’ can have cheap bloody coffee and many other commodities..’things’ and a lifestyle that we take for granted.
    This i’m not complaining about..i enjoy it too!..but rather than being ignorant,i think,well for me anyway,having some sense of the effects of my life, and the decisions i make regarding my lifestyle, on others directly around me and afar is a positive step to dealing with the ‘big’ problems,an example being the vulture fund companies.
    Its not just these specific companies that are a problem.
    Our friendly high street banks that offer high interest accounts and tax free savings/shares/investment funds etc….have you ever thought where ‘your money’ that you deposit is used and for what purpose?…..perhaps you/we dont care.
    Going back to ‘our borders mentality’, whether you think debt relief is a good or bad thing,our goverments are using YOUR/MY money to help these countries to get off their knees so they can compete with us economically,i’m not for giving money with no sense of self reliance and governance,…then these vulture fund wankers come in and make the situation worse and waste YOUR/MY money that has been invested.
    That i think,is, ‘our border’ problem…as if ‘our border’ means anything these days.
    Goverments will only EVER do anything about a situation if you,me..us..shout about it…even though it may come across as a whimper and perhaps hopeless sometimes!
    Well, for me at least, i’m joining Fzy’s campaign and i think this and many other cries from the heart should be called ‘The Mouse That Roared!’ group! hehe
    What do you think Fzy? šŸ˜‰

  12. Thanks so much, Kerry, of course if you and Simon hadn’t blogged it, I’d still be in the dark about this. So thank YOU. :))

    Thank you, Heyman :))

    Thanks, Rii; I asked Simon (aka Red1hols) to come over and answer your questions, so the answers are below yours above (if you follow that!), and I added a lot of links to the original post, so you can do some of that research right here :)) But as I asked with Rainy, please do stop back by and let me/us know what you learn. Many huggs and great gratitude for your very thoughtful comments! xx

    Thank you, Snuggles :))

    Thank you, Simon; that’s so very helpful. And thank you, too, for bringing this out and getting all of us involved in putting a stop to it. :))

    Thank you so much, Jillene! That link is great, and you’re right we’ve seen grass roots movements change the country, the world, so here’s our chance! :))

    Thank you so much, too, Chris, that link is fab. :)) I really appreciate your support on this one. Huggs

    Hey, Nancy, yes, all I’ve seen is coverage of Anna Nicole Smith, nothing about this at all. It’s an outrage; I can’t believe how complacent we are about things like this AND even about what is considered “news” (not that I know how to change that except to email the news outlets and let them know that THIS vulture fund issue is NEWS and needs to be made widely known). Thanks for your comment. :))

    LOL, thanks, Kate (inside joke, Gang)

    Well, I usually feel like this, too, Amber, but I think this is a bit different. Anyway, thanks for reading about it, for stopping by and commenting! :))

    Thank you, Azad :))

    Rash. THANK YOU! I love your comments and couldn’t agree more; The Mouse That Roared . . . love that, too. Hopefully, our mouse (again, I can’t take credit, that goes to Simon and Kerry) will be heard by “those that matter” in terms of being able to stop this foul practice. (btw, you have high interest rate offers over there? Hmmmm . . . lol, sorry, couldn’t resist a bit of a joke) Huggs, Rash, and thanks again. :))

  13. This is tied into the World Bank as well, is it not? I had heard about this in my macroeconomics class, and again in my anthropology class as well. What is funny is that if you visit the World Bank site, little information is actually given, and links change very often. Sometimes big business is not so good, eh? I need to do some investigating about this subject, as do many people. It is our money that makes the businesses run, after all.

  14. I do not know much about the subject. But it does not seem legal and is for sure not moral in my opion. I wonder how these people can sleep at night. Thanks

  15. Fuzzy. Thanks for this. Awareness starts with one and moves to 2, building just this way. Thank you and Kerry and on and on until the little flames fire up a bunch of heat and light. I love the comments your blog evokes…and your smart friends! Yay Fuzzy!

    As an aside, I’m afraid Amber’s comment is the prevailing voice of America at this time, sadly. “ME, ME, ME! And from what I’ve observed and been taught, business and capitalism has no ‘heart’. It isn’t meant to. It is about profit. At least those that believe in it are honest about that, I’ve found. If we ignore it, it will go away. If we just stay within our own borders, maybe it disappear. The Ostrich effect. I, llama, KNOW ostriches. They are really silly when they put their heads in a hole and believe that no one can see them. And there they are, with their big bottoms in the air! LOL I digress.

    I will do something. Hugs to you.

  16. Hmmm, very interesting. I never knew this was going on. I am a bit skeptical of those Third World countries that appeal for debt relief, when they are buying so many weapons, shafting their own farmers, or have kleptocratic leaders that keep siphoning off massive amounts of aid into Swiss accounts, as the UN itself notes. More poverty for the masses is caused by internal government mismanagement that debt problems. Some of the most related poignant writing on the net are from Africans who have seen their work and savings, accumulated over decades of painful effort, destroyed by the corruption and ineptness of their leaders. Zambia is a classic case in point, as is Zaire, and Zimbabwe.

    But your post however puts it in balanced perspective. Someone has to be enabling them whether it be World Bank bureaucrats or collaborating financiers. Someone has to be helping them arrange these debt sinkholes, reaping the profits. Then when the arrangements start to fray or collapse, I have no doubt that some of the same operators, manipulators and speculators who structured the rickety deals in the first place, step in as the “vultures” you mention. I wonder if a lot of these aid deals are meant to fail, just so vulture-like bone pickers can cash in later.

    I hope the whole aid system is restructured to remove as much influence as possible on both sides of the coin- the native kleptocrats, and the Western manipulators who enable them. Money ought to be directed towards smaller, concrete projects, with tight controls, so maximum benefits (and cash) reach the ordinary people on the ground. I jsjt wonder if there may be too many vested interests with other agendas for this to happen.

  17. Very interesting post Fuzzy….at first I dismissed Ambers comments, but my thoughts keep coming back to them and the entire policy. If this is happening in third world countries…could Foreign lenders be doing this here in america and running up our debt. We already know we are in the hole debt wise…maybe this goes deeper than we are thinking. Why would you take on debt of a country that can’t support itself anyway, unless you knew someone was going to keep picking up the tab. I will go check out the links.

  18. Hi Ceres, and thanks for your great comments; do let us know if you find anything further out about this practice. I have to agree that it certainly affects us all, no matter what country we live in.

    Thank you, Bert, and I thought the same thing the first time I read about it: how do these people sleep at night? It’s amazing to me that anyone can be so calculatedly cruel.

    Oh, Gaby, I agree, I love the smarts and the humor of all my friends and their comments are always inspiring, thought-provoking, or giggle-making. :)) Including, on that last count, your own! I do think, though, that it’s not immediately clear how these vulture funds affect us all, so I can see where Amber’s coming from. Thanks for your comments! :))

    Thanks for your fab comments, Sarge; I think they speak for themselves, and I’m so happy you’ve posted them :))

    Yes, Pris, it kept nagging at me, too, so I know where you’re coming from, and it certainly does affect us right here in the U. S. of A. On a human level it’s reprehensible, but if we need evidence that it affects our wallets, well, it’s there to be found, right? Huggs and welcome back from your camping trip. Missed you!! :))

    Thank you, River. :))

  19. “The most recent case of this happened in Zambia, where Donegal International sued Zambia for $42 million. Keep in mind that Donegal International itself paid only $4 million for Zambia’s debt, and the judge is expected to award Donegal “only” $10 to $20 million rather than the forty-two they asked for.” This is indeed outrageous. You claim you are releiving a nation of it’s debt burden while in actual fact, you are adding 3 x or 4 times to the initial burden. This is trully injustice and inhumanity to mankind.

  20. Thank YOU, Mercy for reading about this; I do hope that you signed the ipetition or contacted your officials/news outlets or whomever you know can speak for the people or put a stop this appalling practice! Huggs :))

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