ProPublica | The New York Times Magazine, 2023
Author(s): Abrahm Lustgarten | ProPublica, Staff | The New York Times Magazine
ProPublica’s Abrahm Lustgarten brought attention to how international monetary policy and Wall Street’s incentive to generate returns for investors are making it difficult for small, poor Caribbean countries like Barbados to recover economically from the cost of disastrous hurricanes and other effects of climate change.
Lustgarten’s reporting revealed how international monetary policy and Wall Street’s expectations for profitable returns are forcing severe internal budgeting and national spending policies on vulnerable countries that already are trying to recover from damage caused by the intense hurricanes and other environmental challenges attributable to global warming.
Lustgarten began the project in late 2021 to understand how unprecedented levels of national debt might be affecting the ability of small nations to adapt to climate change. Focusing on the role of large global financial institutions, including the International Monetary Fund, the trail led him to the Caribbean, where 40 million islanders face heat-driven water scarcity, crop failures and the threat of increasingly powerful hurricanes.
Lustgarten analyzed policies, loans and multiple disasters that led to Caribbean countries having some of the highest levels of debt in the world. His reporting brought him to Barbados where the country’s prime minister, Mia Mottley, has become outspoken in her call for equal treatment for smaller countries struggling to cope with climate change since her election in 2017.
Lustgarten closely examined the policies of banks holding Barbados’ debt, including Morgan Stanley and Scotia Bank. He found they pressured the country to pay credit-card-like interest rates at the threat of default. Lustgarten’s reporting, published in The New York Times Magazine, prompted the IMF to ease debt repayment policies for Barbados. The IMF also created a $55 billion trust fund to help alleviate the cost for small, debt-burdened countries dealing with climate change. Barbados became the trust’s first beneficiary.
Dozens of small countries also relied on the reporting to collectively make their cases for a form of funding to compensate countries for costs incurred due to climate change. Their advocacy for the funding to cover loss and damage costs because of climate change became the predominant issue during the United Nation’s Global Conference of the Parties climate change conference in Egypt in November 2022
At the end of the conference the countries agreed on a tentative economic reform framework known as the Bridgetown Initiative. The initiative is named for the capital of Barbados and was formulated by Avinash Persaud, the country’s economic adviser whose arguments were first highlighted in Lustgarten’s story.
Lustgarten also spent months investigating the internal decision-making of the World Bank and the IMF. At the IMF, he found a system beholden to the banks and the U.S. Treasury, which made aid to Caribbean countries based on their guarantees that Wall Street investors would make a profit. The IMF adhered to the policy despite its own warnings that the rapidly rising costs of climate change made such policies irrational and even deadly.
The result of Lustgarten’s reporting is a story about the unique vulnerability of small island states and a global banking, financial and economic establishment that has been capitalizing on their distress.
For the first time, Excellence in Environmental Reporting is named in honor of Edward W. “Ted” Scripps II. Early in his career, Ted worked as a reporter for United Press and Scripps Howard newspapers in Denver and San Francisco. Ted also served as a vice president and secretary of The E.W. Scripps Company. He was a conservationist with interests in environmental issues and changing technologies in the communications industry.