Cancellation of debt breaks cycle of loans

In an article written by Jeffrey Sparshott for the Washington Times he writes that,

An agreement reached by rich countries on Saturday would for the first time eliminate the entire principal on more than $40 billion in loans owed by 18 of the world's poorest nations, rather than just lowering payments or reworking terms."

He goes on to write,

There is still no agreement among wealthy nations on how to link a debt write-off with an increase in aid.

Group of Eight leaders are scheduled to meet next month in Scotland. France and Germany have proposed taxes on airline tickets in an attempt to boost aid to poor African countries. Hans Eichel, the German finance minister, said the tax 'is now on the working program of the G8.'

U.S. Treasury Secretary John W. Snow reiterated U.S. opposition to the proposal, but said the United States would not block the tax if other leaders choose to implement it.

'The United States would not participate in any global tax scheme to raise money,' said Tony Fratto, spokesman for the U.S. Treasury Department. He said the agency would prefer the United States ask Congress for funds when it needs it."

You can read the rest of the story here.

I'm glad that the U.S says they would not participate an any global tax scheme. We don't want to get started down that slippery slope. I still fear that kind of idea in the future. Will future Democrat presidents resist this idea, or will they embrace global taxes that the U.N. and E.U. seek? I fear the latter to be true.