Around the world the U.S. is confronted by the plight of poor but friendly countries that have borrowed heavily and spent unwisely. A traditional American approach has been to make new loans so that the debtors can repay old ones. Debt forgiveness, by any name, has always been anathema, since most of the borrowed money comes from private banks whose directors and shareholders are not in the forgiveness business.
The Bush Administration has worked out a formula to help ease the burden on some borrowers while maintaining the confidence, and therefore the cooperation, of lenders. Announced by Treasury Secretary Nicholas Brady...
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