Obviously, this transformation from respected academic superstar to a person considered to be an enemy of humanity is a case worth studying. Sachs' first foreign adventure in public policy formation took place in Bolivia in 1984. Bolivia was an economic basket case caught in a debt spiral caused by corrupt overborrowing by a succession of military juntas. American banks had loaned billions that had been spent on weapons or simply squandered on payoffs that had increased the numbered bank accounts of anyone who could get their hands on the money. Besides, Bolivia was a prime source of vital natural resource-tin.
Tin is used for food packaging and electronic circuits.
But in the go-go lending days of the 1970s, so many banks simultaneously took Wriston's advice seriously, Bolivia's income from tin was borrowed against many times over. Then the worst happened, the international price of tin collapsed as consumers around the world found substitutes-especially for food packaging. By 1983, it was obvious that there was no way that Bolivia could even pay a fraction of the interest it owed on the money it had borrowed. Not only had the price of tin collapsed, but none of the money borrowed had been used to create alternative sources of income. The money had been spent or stolen-not invested.