Breaking the Cycle of Debt and Poverty: A Call for Care-Centered Approach to Advance Debt Justice

We are constantly hearing-talking about the so-called debt crisis. This is a concept that is still abstract for some of us—even those who are living in the most in-debt countries.  

In today's world, debt is an overwhelming reality for many global south countries and those living there. The consequences become evident in recent days, in daily basis life, especially in countries in the global south. 

Countries like Argentina, Uganda, Egypt, and Haiti, to name a few, are concrete examples of the impact of restrictive loan conditions from international financial institutions like the IMF or the World Bank. 

In May 2018, Argentina experienced days of violent protests against the deteriorating economic situation. In July of the same year, Port-au-Prince, the capital of Haiti, experienced widespread unrest and total paralysis of activities for over five days following the government’s announcement of a significant increase in fuel prices. These decisions by the respective countries' authorities fall within a framework of austerity measures imposed by financial institutions. However, the demonstrations and calls from the population to disregard these financial requests are ignored. Consequently, these heavily indebted countries are forced to make drastic cuts to social programs in the first place, greatly jeopardizing the livelihoods of historically marginalized groups and communities, especially women in all their diversity.  

When a global pandemic like Covid-19 hits, the situation escalates further. The COVID-19 pandemic has made clear the centrality of care for life, the preservation of the planet, and the functioning of economies and societies. The pandemic has deepened the gaps in the distribution of care and placed an even more significant burden on women and girls, leading to a crisis in the global care economy. 

The unsustainable debt affects care workers.

The austerity measures include cuts to public services like health care, education, and social welfare, disproportionately impacting women. In our patriarchy societies, women have been forced into structures that naturalize care as their sole responsibility and valuable. So women are forced to take on more care responsibilities, making participating in paid work or education challenging. Moreover, care work remains unpaid primarily, unrecognized, invisible, and increasingly privatized and commodified as a source of profit for corporations.

Domestic Workers, the majority of whom are women,  often face exploitation and abuse from their employers. They are usually not paid a fair wage and are forced to work long hours without sufficient breaks. This seriously affects their physical and mental health and their ability to care for their families. In addition, these women are merely covered by labor laws and do not have access to social protections, making them even more vulnerable to debt and poverty. Without justice and care for these women, the cycle of debt and exploitation will continue, affecting future generations.

Children's rights are also affected as their access to education, health care, and essential services is diminished. Ultimately, this creates a cycle of poverty that directly affects women as caregivers and perpetuates this impoverishment for generations.

Centering care while advancing debt justice is a critical priority for addressing the devastating effects of unsustainable debt. 

The will to unite, voice, and pursue debt justice

Recognizing the impact of unsustainable debt on women and prioritizing care to achieve debt justice is essential. This means providing social protections and support for marginalized and impoverished communities, including domestic workers, and enforcing labor laws. 

In the network and with allies, ESCR-Net members continue to build on evolving discussions around debt and care. The New Social Pact on Care, developed by members, provides the 6R framework to redistribute care work and ensure the representation and recognition of caregivers. It aims to promote feminist economics and advance policies that reduce the care burden, reframe the economy, and fulfill the rights of caregivers and recipients. A care economy prioritizes the well-being of people over profit and market interests. This requires that the human cost of debt be acknowledged and redressed. 

To achieve this, in addition to a better understanding of neoliberal capitalism and its roots, there needs to be a transformation in how we conceptualize and address debt. We must move away from a narrow focus on debt sustainability and repayment and towards a more human-centered approach that recognizes debt's social, economic, and environmental dimensions. 

That is why ESCR-Net members actively discuss interrelated economic policy, women, and climate justice issues. From June 12 to 15, ESCR-Net and its member, Centro de Estudios Legales y Sociales (CELS), are hosting a Systemic Critique Workshop in Argentina. The workshop aims to examine the relationship between sovereign debt and care work, with a focus on breaking down and analyzing this intersection.

The workshop aims to discuss the underlying issues of neoliberal capitalism that lead to unsustainable debt. This includes predatory lending practices, lack of transparency in debt negotiations, and inadequate regulation in the financial sector. The workshop will also focus on identifying opportunities for promoting alternative economic and development models and advocating and campaigning for change to address the contradictions in our current system.