Dominican leader urges Wall Street-style ‘bail-out’ to reach UN poverty goals

President Leonel Fernández of the Dominican Republic today called on the world’s richest countries to provide the same emergency funding to achieve the United Nations Millennium Development Goals (MDGs) aimed at slashing global poverty, hunger and other social ills as they have to bailing out failed financial institutions.

“The peoples of the world who suffer from hunger and misery raise their voices to urge the international community to pay the same prompt attention to solving their needs as it has in rushing to the rescue of banking institutions on the brink of collapse,” he told the General Assembly on the second day of its annual high-level debate.

Mr. Fernandez noted that while the world’s richest countries had pledged extraordinary development aid at the UN Millennium Summit in 2000 to achieving the MDGs, only five – Denmark, Luxembourg, Netherlands, Norway and Sweden – had fulfilled the goal of contributing the equivalent of 0.7 per cent or more of their gross domestic product (GDP).

“What is certain is that at this moment, in order to achieve the Millennium Development Goals, we need from the international community a financial rescue plan, a kind of ‘bailout,’ as they say these days,” he said, citing World Bank figures that $50 billion is needed annually to reach the MDGs by their target date of 2015.

“That means that in order to achieve the goals of raising the quality of life and the conditions of dignity of the world’s poor nations we need an international economic financing plan that is as bold and urgent as the one that is presently being put into effect to save Freddie Mac, Fannie Mae, Bear Sterns, Merrill Lynch, AIG and other financial institutions,” he declared.

In fact, the amount needed would total $350 billion, according to the World Bank figures, “just half of what is currently being debated in the United States Congress to save from collapse those Wall Street financial business that are responsible for their own failure,” he added.

Mr. Fernandez also assailed unregulated speculation in selling and buying futures contracts in oil and foodstuff, which “through excessive speculation, fraud and manipulation” lead to the distortion of economic fundamentals.

“It is incomprehensible that someone sells what he does not have and somebody else buys something that he does not want to have,” he said. “Yet that is what has been happening these days in the clearest demonstration of what is being called ‘casino capitalism’.”

Referring to the “stupefying” rise in the price of oil, he said that the extra $5 billion that the Dominican Republic has had to pay since 2004 could fund all public investments needed to achieve the MDGs by 2015.

President Elías Antonio Saca Gonzalez of El Salvador also broached the financial crisis, calling for reform. “The financial economic order can be at the mercy of speculative markets,” he told the Assembly.

“We must jointly reconstruct a prudent capitalism which finances economic development and not speculation,” he said. “We must help to prevent and mitigate the grave financial fluctuations, bring some equilibrium to balances and stabilize credit.”

He applauded French President Nicolas Sarkozy’s call for a speedy meeting of those countries most affected to work out a joint solution to the worst financial crisis in 75 years.

Mr. Saca Gonzalez also called for reform of the Security Council to make it more democratic and representative of the real world.

Honduran President José Manuel Zelaya Rosales said the financial crisis and “financial fraud perpetrated by the big transnational companies” were endangering all the relative advances his Central American country had made economic growth and poverty reduction.

“Today when they rush in to save the big banks from failure in a crisis created by speculative and fraudulent capital, to the value of some $700 billion, we must remind them that with just a third of that amount poverty could be eliminated in Africa, America and Asia,” he told the Assembly.

“Capitalism is devouring humanity, especially the poor and the very capital that created it,” he said, adding that the goal must be not to destroy the market but to build a social market economy, defining the limits of capitalism and ending the rule of the law of the jungle.