Structural adjustment engulfed the developing world in the wake of the debt crisis of the early 1980's. As defined by the World Bank, it required distressed and often deeply indebted economies to introduce sweeping, market-oriented reforms in return for emergency finance in the form of Structural Adjustment Loans (SALs). After twenty years of such reforms, UNCTAD's 1999 Trade and Development Report concludes that "the expectations of the gains from such [policies]... have been disappointed," while "the downside risks have proven far greater than was generally expected." This article shows why these results should not come as a surprise. In fact, the international financial institutions had little or no empirical evidence to support the claim that these policies would promote growth, development, or human welfare. In fact those claims were simply derived from a very narrow, ideological reading of economic theory that could not legitimately be used as a basis for real world policy prescriptions. Moreover, once these policies were being implemented, those same institutions systematically misrepresented the accumulating evidence in order to justify policies to which they were clearly committed, in spite of, and not because of, real world evidence. The explanation for their a priori commitment to these policies can only be found by examining the interests most directly served by them. This leads directly to the conclusion that the overriding priority of structural adjustment was the maximization of the developing world's capacity to service its international debts. This was achieved by creating a framework in which key allocative decisions would be increasingly dominated by financial markets that allocate resources strictly in accordance with an increasingly unequal distribution of "effective demand" - or income. When combined with the insistence that "all debts must be repaid in full," this created a situation in which long term development and human welfare in the developing world were given a distinctly lower priority than debt repayment and rewards to current investors. And that is likely to remain so unless political processes within sovereign nation states can insist on a different set of priorities.