Global South drowns in monetary austerity while the G7 gets rich printing money

Let us imagine for a moment everyday household economics: when a working-class family loses income, the corner banker's immediate prescription is to cut the children's snacks, sell the old car and tighten the belt.

For more than four decades, the Group of Seven (known as the G7, the alliance of the world's most industrialized economies made up of the United States, Japan, Germany, the United Kingdom, France, Italy and Canada) applied exactly this same recipe to the Global South. Bureaucratic Washington agencies forced us to freeze public hospital budgets, privatize strategic resources and cut wages in the name of "fiscal discipline." Yet in the last week of August 2026, the spectacle of international hypocrisy has been completely exposed.

It turns out that the U.S. government has just surpassed the astronomical figure of $35 trillion in public debt, or 124% of the country's entire gross domestic product (GDP), the total value of goods and services the country produces in a year. To sustain such a mountain of borrowing, the U.S. Treasury is spending more than $890 billion this year just to pay interest to lender bankers, far exceeding its own military budget.

While the Federal Reserve (Fed), the U.S. central bank responsible for setting the benchmark interest rate, keeps the cost of money sky-high at 5.25% on the grounds that it is fighting inflation, governments in the North inject multibillion-dollar subsidies into their local corporations. By contrast, we in the emerging and less-favored economies of Latin America are ordered to make abrupt cuts, under recipes dictated by multilateral bodies linked to the United States such as the International Monetary Fund (IMF), while the major economic powers print bills to rescue their big tycoons.

This asymmetry is not a mere technical distortion but a deliberate mechanism of monetary domination that strangles financing for Latin America.

Each time the Fed raises or maintains its rates, international credit to build schools, roads and aqueducts in our region becomes inaccessible or ridiculously expensive.

As long as Latin American economies remain trapped in exporting raw commodities without added value, we will keep financing the North's consumption with the sweat of our workers.

It is time to stop listening to the old recipes of pinstriped economists and to advance boldly toward a sovereign financial architecture, with regional development banks that can finance local industrialization and protect our collective patrimony.

Sources: U.S. Department of the Treasury, Debt Registry (https://www.fiscaldata.treasury.gov) | Congressional Budget Office (CBO) (https://www.cbo.gov) | SurEconomics Macroeconomic Observatory (https://www.sureconomics.com)