Marco Rubio today may be the head honcho at the U.S. State Department, but it was just a few years ago that he was pounding on the door of that same government entity demanding that it force the government of Argentina to pay Wall Street hedge fund vulture Paul Singer billions in interest on outstanding loans even at the risk of the country going into default.
Due to the largesse of his erstwhile political foe Donald Trump, Rubio today gets to hop-scotch around the world, scold other countries for their moral failures, and promote the neoliberal economic model that has made debt a major issue around the world, forcing countries like Argentina to slice pensions, eliminate teacher jobs, and destroy safety nets for the poor so that they can pay Shylocks like Singer their usury.
“He is accustomed to thinking about American foreign policy as a responsible policy maker,” Singer said back in 2015 when he threw his substantial financial support to Rubio’s presidential campaign. “He is ready to be an informed and assertive decision-maker.”
Today Argentina, under its Trump wannabe leader Javier Milei, is not only still reeling in debt ($40 billion to the International Monetary Fund, and Milei is seeking another $20 billion from the United States) but also from deepening poverty, disappearing government services, and from the fact that some 40,000 former government workers are out of a job due to the chainsaw-wielding Milei.
(To the right, Javier Milei, photo by Gage Skidmore)
Milei has cut inflation down from a monthly 25 percent to just 2 percent, but prices are still high in tango land, and pensioners in particular are suffering from the combination of high cost of living and reduced services.
Rubio’s friends on Wall Street actually have forced Argentina into default twice—once in 2001 and again in 2014. Here’s how it works: Hedge fund operators purchase the bonded debts of struggling nations and then eventually demand full payment, which with interest can be 10 to 15 times the original debt. With the backing of friendly judges, these “vultures”—tagged that name by Peronist former Argentine leader Christina Fernández de Kirchner—can ignore debt restructuring plans and warnings of default with their insistence on full payment.
Argentina actually had worked out a deal with most of its bondholders that would have created a repayment plan albeit with some losses on their investments. Hedge fund operators, however, got involved, bought the bonds at a hugely reduced price (due to the 2001 default), and rejected any such deal. They were backed by U.S. courts.
Singer’s hedge fund, Elliott Management, is estimated to have taken in $2.4 billion from Argentina, as much as 15 times the original debt. The fund bought $50 million in Argentine bonds and essentially sold them back for $2.4 billion.
It was Rubio, as a U.S. senator from Florida, who kept “banging on the State Department” door, according to journalist Greg Palast, to let Singer have his way in Argentina. “This was money screaming,” Palast said in an interview with Democracy Now.
These financial wheeling and dealings aren’t just in Argentina. Global debt is a huge crisis. According to Maryknoll magazine writer Thomas Gould, nearly half of the world’s population “lives in countries that spend more on debt than on either education or healthcare.”
The debt arises out of loans provided by the International Monetary Fund, World Bank, and private lenders. The Oxfam organization estimates those private lenders control more than 50 percent of this debt.
Maryknoll, a Catholic publication, notes that the late Pope Francis made debt cancellation a primary focus of his papacy.
“The usurer is worse than Judas,” St. Anthony of Padua said back in the 13th century. “The traitor, having sold the Blood of his Divine Master, brought back to the priests and princes the thirty pieces he had received, but the usurer guards and keeps his unjust gains.”
