This chapter explores how the industrial world views the debt crisis, the strategy the industrial countries have employed to keep the major debtors working within the system, and the relevance of democratization in Latin America to bank and multilateral institutional decision making. The strategy devised by the industrial countries to deal with the debt crisis has been either one of “quarantining” the most dangerous debtor or of “muddling through.” A number of factors led other industrial governments to support the Reagan administration’s approach to the debt crisis. The implicit decision to leave the process of crisis management entirely in the hands of the United States has had serious implications, both in terms of the debt crisis itself and for US-Latin American relations. The debt crisis exploded in Latin America in mid-1982, when a series of governments were making a complicated transition from military rule to democratic regimes.