Rethinking Sovereign Debt: Pleading for Human Rights, the Rule of Law, and Economic Sense

Reviewing and commenting on Lienau’s book Rethinking Sovereign Debt, Politics, Reputation, and Legitimacy, this paper agrees with most of her points, aiming at supporting and complementing rather than contradicting her line of argument. It wants to corroborate her points as well as to bring up aspec...

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Bibliographic Details
Published in:Accounting, economics, and law economics, and law, 2016-12, Vol.6 (3), p.243-262
Main Author: Raffer, Kunibert
Format: Article
Language:English
Subjects:
Debt management
Debt restructuring
Human rights
insolvency
international finance
Legitimacy
Politics
Principles
Reputations
Rule of law
Sovereign debt
sovereign debt restructuring
Sovereignty
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Summary:Reviewing and commenting on Lienau’s book Rethinking Sovereign Debt, Politics, Reputation, and Legitimacy, this paper agrees with most of her points, aiming at supporting and complementing rather than contradicting her line of argument. It wants to corroborate her points as well as to bring up aspects that the book does not discuss. It presents two main comments on the more civilized treatment of sovereign debtors before WWII, and on the role of the Bretton Woods Institutions after 1945 that – as Lienau correctly notes – changed the positon of debtors fundamentally. The paper shows that going further back into history than the book did, namely sovereign debts in the nineteenth century, strongly corroborates Lienau’s line of argument regarding the period before WWII. The paper complements the role of the Bretton Woods Institutions with further facts, arguing that their strongly statist view is also self-serving and helpful to support multilateral lending practices violating these institutions’ statutes. Finally, the new tendency back to a non-statist regime she rightly observes is commented on, pointing out that present debt management in the eurozone constitutes a considerable backlash.
ISSN:2194-6051
2152-2820
DOI:10.1515/ael-2015-0015