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Tuesday, February 04, 2020

The necessity of debt cancellation

An excellent interview with Michael Hudson, author of And Forgive Them Their Debts:
Rees Jeannotte: To think about a more sensible way to deal with a debt crisis. Maybe you can use the most recent example of a national debt cancellation, namely here in Germany.

Michael Hudson: That’s right. The German Economic Miracle was the Allied debt reforms of 1947/48. They essentially wiped out all debts except for what employers owed their employees – you know, the workers’ wages and minimum working balances at the banks. It was easy for the Allies to cancel the debts owed to German creditors. because the creditors were mainly Nazis. The whole idea was to wipe them out. They didn’t the want to leave the former Nazis with financial power to take over the economy again. They wanted a Clean Slate.

Canceling the debts created the German Economic Miracle. Because the economy was able to operate without personal debt, and without much public debt or corporate debt. It was able to take off. Today, essentially you’re dealing with a criminalized banking class that I think we should treat in the same way that the Allies treated the Nazis. If you don’t cancel the debts owed to them, the economy is going to shrink and shrink, and polarize. We’re going to have essentially a neo-feudalism controlled by the creditor class, like you had in Rome in the Dark Ages. Do you really want a new Dark Age?

Rees Jeannotte: No, not particularly. This leads us into the financial crisis of 2008, where you were among the few people to predict it accurately. It was largely based on a giant private debt bubble. Private debt is something that we don’t hear much about. I tried to look for the totals on private debt worldwide. You find out the debt to GDP ratio for public debt. For government debt, but it’s never about private debt.

Michael Hudson: That is because the right-wing politicians want to abolish government and the social services it provides. Apart from the money governments owe for military spending and NATO, they owe pensions and health care. The right-wing program in Germany and Europe is to get rid of pensions, to lower them, to financialize and privatize the pension system instead of Germany’s pay-as-you-go system, which is quite good. They want to get rid of social spending.

Also, they look at government debt as the adversary of private debt. For instance, in the United States, President Clinton finally ran a budget surplus in the last year of his rule. What happens when a government runs a surplus? That means that it doesn’t spend money into the economy. The economy has to rely on banks to get credit, because every economy needs credit to function and grow. Bankers realize that if the government doesn’t provide the economy with money – by spending deficits into the economy to promote employment – then people will have to borrow from the banks. But if they keep borrowing from the banks to buy homes rising in price and just to maintain their living standards, their families will end up looking like Greece or Argentina. They’re going to have to pay more of their income as interest. Bankers will end up with the houses, and with private industry. They will end up controlling everything, including the government.

For thousands of years the leading tension of civilization has been over who is going to dominate and plan society’s economy. Will it be democratic governments or wise rulers seeking stability and military security? Or, will it be a financial oligarchy that wants to get rich by impoverishing the rest of society?
He's correct. The ultimate and mathematically certain outcome of the current financial system is that the owners of the banks own literally all the property and all of the people. This is not a question of right-wing vs left-wing, and it's very important to remember that banks are not capitalism, corporations are not human beings, and usury is not freedom.

Quite the opposite, as it happens.

As usual, there are commenters at Unz who can be relied upon to produce the retarded "conservative" attack on debt cancellation. Make no mistake, if at this point you still oppose debt cancellation on the grounds of "personal responsibility", you are economically retarded, by which I mean, you are so stupid, so shortsighted, and so unable to do the very simple math involved that if I had the ability to do so, I would forbid you to read this blog.

If it’s selective then people who made responsible economic decisions will be forced to subsidize the self-indulgent and/or foolish economic decisions of others. 

The inexorable math of usury and the way in which credit shifts the demand curve upward dictates that however "responsible" your economic decisions are, sooner or later you will be forced to not only "subsidize the self-indulgent and/or foolish economic decisions of others", you will be forced to make equally foolish decisions yourself. The fiscal conservative's belief in "responsible debt" is no different than the Churchian's belief in Judeochristianity, and it stems from exactly the same evil source.

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221 Comments:

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Blogger Shimshon February 04, 2020 9:08 AM  

"If it’s selective then people who made responsible economic decisions will be forced to subsidize the self-indulgent and/or foolish economic decisions of others."

What about the banksters, who foolishly and self-indulgently chose to lend to unsuitable borrowers? Should they be bailed out when the crunch comes? Retarded.

Blogger McChuck February 04, 2020 9:10 AM  

The bailouts of '08-'09 accomplished nothing but paying off rich bankers. The money could have been used to pay off all personal credit card debts, with plenty of spare. But that would have helped the average American, not Wall Street bankers.

Blogger Brett baker February 04, 2020 9:13 AM  

I suspect a lot of folks opposing debt cancellations, or even just reductions in interest rates, wouldn't want their own financial affairs looked at too closely.

Blogger Wraithburn February 04, 2020 9:15 AM  

For me, the hardest thing to get through to people is that debt cancellation is not a transfer. They continue to erroneously believe that if student loans are cancelled, suddenly the taxpayer will pick up the tab.

How the bank can demand the taxpayer pay for a cancelled debt never goes through their mind.

Blogger RandyB February 04, 2020 9:16 AM  

Before I started reading this blog, I was in the "personal responsibility" camp.

Not any more. Now I get it.

Blogger CarpeOro February 04, 2020 9:25 AM  

The linked interview is well worth the time to read. Thanks.

Blogger Jose Miguel February 04, 2020 9:29 AM  

Amen! Even though I paid off my student loans by being homeless for a while, forgiving private debt would do wonders for my business endeavors as a lot of people i know would be able to buy real stuff and services from myself and others and not have the banks siphoning everything.

Blogger Cederq February 04, 2020 9:32 AM  

"and so unable to do the very simple math involved that if I had the ability to do so, I would forbid you to read this blog." I would rather see caning and a liberal use of 2X4s upside the head. I was a tard until I started reading Vox and his book recommendations that I have learned to shut up and listen more closely to my intellectual betters.

Blogger nrthrn stncrft February 04, 2020 9:34 AM  

Is there a good and true work-around to the debt problem? Going forward should we grow our businesses through independent investment?

Blogger FisherOfMen February 04, 2020 9:48 AM  

I'm curious if the endless dangling of "we're going to forgive debt any second now, it's totally going to happen" is in and of itself a mechanism to keep people in slavery.

At this moment, I could pay off my house. I'm not doing so because I expect either debt forgiveness or a government that will confiscate property sometime in the near future (the democrat "revenge president" after Trump is going to be fierce).

Blogger Tars Tarkas February 04, 2020 9:50 AM  

Unfortunately, we live in clownworld and so debt relief would be done through the Democrats and would be framed, and probably structured to most benefit blacks, browns and women. This would almost certainly come with other reforms such as "tuition free college for all," allowing the existing college institutions to keep existing and be financed from the tax payers. Those 300,000 dollar diversity executive salaries will now be paid for by the tax payer.

Of course, we would have to change the laws and basically end credit cards and other lines of personal credit.

Blogger Raker_T February 04, 2020 9:50 AM  

It's so neat to have a cloudy perception of the situation, then others come and very clearly do a perfectly focused job of explaining it. This blog is worthy of superlatives stacked in freight cars, but I'll spare you that, other than thanks. Man I love it.
All this money lending has created a situation whereby from what I understand, corporations park their money in land holdings, which further drives up the cost. Sort of like carbon credits given to those who but South American forested acreage, the natives have that much harder time owning land.
Looking at it from a physical perspective is interesting too. The house is a little square of dirt with lawn, and a wood frame structure. Sticks with sheetrock, plumbing and vinyl siding, assembled with a big staple gun. Price: quarter of a MILLION dollars. My mother bought a house in CA in 1971 for $21K. It sold in about 2013 for $275K. It's getting surreal.

Blogger Tars Tarkas February 04, 2020 9:57 AM  

Wraithburn wrote:For me, the hardest thing to get through to people is that debt cancellation is not a transfer. They continue to erroneously believe that if student loans are cancelled, suddenly the taxpayer will pick up the tab.

How the bank can demand the taxpayer pay for a cancelled debt never goes through their mind.


It is the gov who owns most of the student loans. But that is only the existing student loans. There is the bigger problem of going forward. They would most likely want to have tuition free college for all. The quality of the colleges will collapse and the price, already ridiculously high will runaway. All of the BS in the universities would become permanent government programs. All those women's studies, ethnic studies, sociology, queer studies etc would be the primary beneficiaries. Now that the colleges are a gov program, the lack of black and brown people will have to be addressed.

Blogger RobertDWood February 04, 2020 9:59 AM  

Break the banks. Andrew Jackson was right.

Blogger Patrick Kelly February 04, 2020 10:00 AM  

"...suddenly the taxpayer will pick up the tab...."

We already picked up the tab. The banks and schools got their money, they don't care about defaults because now the Feds act as a loan shark collection mob via the strong arm of the IRS.

If it's not collected the money has to be made up by someone, that someone being us tax payers.

But I still support the debt cancellation and abolishing the whole obscene, fraudulent, criminal, education financing industry. If my taxes are spent on someone else's education I'd rather just give it away as grants and subsidies than feed the globohomobanksters.

Blogger Glen Sprigg February 04, 2020 10:06 AM  

Is there a link that explains the 'Judeochristianity' issue for the uninitiated? I would like to know more about this viewpoint.

Blogger stevev February 04, 2020 10:06 AM  

This comment has been removed by the author.

Blogger Crush Limbraw February 04, 2020 10:06 AM  

In the foreword to his book “Millennialism and Social Theory”, the author Gary North makes what I considered an ironic statement. He noted that when a secular academic finds out that his book was written by a bible believing Christian, he would immediately toss it away as not credible. The Christian believer, on the other hand, has zero interest in social theory. I can personally confirm the last statement by my personal experience with various Christian churches and study groups – they’re not interested!
Therein lies the problem. The bible, especially the old testament, is full of social theory. Yet, the academics won’t take the time to study those theories – and the Christian believers, who have turned their faith into a personal pursuit of pietism, aren’t interested because it doesn’t fit their presuppositions as drilled into their Churchian noggins from DaPulpits.
How do I know?
Yup - been there, done that!
When Vox says Christianity is one of the 3 pillars of Western Civilization - it not only is that spiritually - it is fundamentally in ALL aspects of life, culture and governance!

Blogger swiftfoxmark2 February 04, 2020 10:08 AM  

A simple way to make it more palatable to "conservatives" might to say that debt and credit makes everything it buys into a Ponzi scheme.

It's pretty obvious once you see things from that angle. Housing in the United States right now is a Ponzi scheme. Those who bought their homes earlier than 2000 are making bank when they sell them today.

Blogger CarpeOro February 04, 2020 10:13 AM  

The linking of the results of unchecked debt creation cycles to the collapse of portions of society and military defeat was interesting. Being fascinated with military history and having some understanding of Rome's fall, this really tied some key points together. My personal take had leaned toward the destruction of the yeomanry being the real cause (not Christianity), this gives insight as to how it occurred. Definitely not the stuff that any of my history professors gave focus. Adds another layer to understanding the present state of things in the USA.

Blogger Bert Head February 04, 2020 10:16 AM  

I remember reading an analysis of one of Argentina's crises, when most of the debts had been forgiven in the usual manner, with currency collapse and insolvency of counterparties. A curious thing was that one of the few performing assets of the banks was credit card debt, which their customers were still servicing.

Blogger John Regan February 04, 2020 10:20 AM  

As many others have pointed out, in a central bank governed monetary system "new" money MUST be borrowed into existence. Without borrowing, the money supply stagnates and the game will not run. The "game" is that the interest on the loans is never created at all, and interest is always "front-loaded", so that the economy as a whole becomes a collective scramble to pay interest in which producers are basically pitted against each other to service the debt and pay the interest to the lenders

There's a certain sense to the system, and it might even be workable with periodic jubilees; but without the jubilees when they become plainly necessary it does degenerate into something horrifyingly evil

Blogger Canada78Bear February 04, 2020 10:20 AM  

If a reset button is available then how do you prevent it from being abused? If the outcome is assured to be reset every generation then what is the point in saving or investing wisely intergenerationally?

Humans are very good at gaming the system and I have not yet seen any approach to recognize this AND plan for it.
A reset would only get real support if it includes provisions for preventing future resets. That I think is what Conservative.Inc really wants

Blogger maniacprovost February 04, 2020 10:22 AM  

How the bank can demand the taxpayer pay for a cancelled debt never goes through their mind.

I suppose... If you cancelled student debts, that would make sense.

Since they're inextricably tied to federal subsidies and guarantees, that might result in a total loss of the government's unofficial credit rating, which isn't necessarily bad.

I wasn't aware this option was on the table. The proposals from the Democrats clearly call for taxpayers to pay off the entirety of the debt, which is in no way superior to the current situation.

Blogger Boaty Bear February 04, 2020 10:25 AM  

"They would most likely want to have TUITION FREE college...."

Isn't that what the youngsters are going into debt for now?

Blogger Unknown February 04, 2020 10:26 AM  

I humbly request this topic for tomorrow's darkstream.

Blogger Stilicho February 04, 2020 10:27 AM  

Shimson nailed it. The irresponsible banksters must pay by having their asset (the debts) wiped off their books.

As for ignoring public debt, that is just as foolish (the Keen fallacy) but it is a slightly different problem. It is also one that can be ameliorated somewhat for individuals by converting savings/wealth into assets that are not directly tied to public debt (e.g. non-fiat assets such as land, gold, equity interests in productive enterprises, etc.).

And once again- crony capitalism/socialism, usury, etc. Are not capitalism. Capitalism merely describes the phenomenon of individuals pooling resources to jointly engage in a productive enterprise/commerce. The bankster class has claimed what they do (financialization of everything via usury) as capitalism in order to provide cover for and gain unthinking support for what they do, but it isnt capitalism. Financialism would be a more accurate term. Calling it capitalism is like calling a slaughterhouse "sheep herding" .

Blogger Crush Limbraw February 04, 2020 10:30 AM  

Glen - DaLimbraw Library (DLL) has whole section on J-C by different authors, including Vox.
The purpose of it is exactly as you stated - for the uninitiated.
I just word searched Judeo-Christian -
https://crushlimbraw.blogspot.com/2019/12/judeo-christian-judeo-christianity-is.html?m=0 - this was the last post with my intro.
You can word search anything else at your leisure.

Blogger Ominous Cowherd February 04, 2020 10:32 AM  

Glen Sprigg wrote:Is there a link that explains the 'Judeochristianity' issue for the uninitiated? I would like to know more about this viewpoint.
No link handy, but consider this: the irreducible element of Christianity is that Jesus of Nazareth is the promised messiah and uniquely our savior. The irreducible element of Judaism is that He is not.

Judeochristianity is like saying Christian Satanism.

Blogger mgh February 04, 2020 10:34 AM  

After cancelling debt, do we prohibit it or limit it going forward?

Blogger David son of Mark February 04, 2020 10:40 AM  

I heard someone propose having student loan payments be deductible one-to-one on each persons’ federal taxes. That’s a way for the government to essentially forgive student loans while not giving out freebies. Could that work?

Blogger Wraithburn February 04, 2020 10:42 AM  

Patrick Kelly wrote:We already picked up the tab. The banks and schools got their money, they don't care about defaults because now the Feds act as a loan shark collection mob via the strong arm of the IRS.

If it's not collected the money has to be made up by someone, that someone being us tax payers.


Yes, we are currently paying for 1/4 of the $1.5T student debt as taxpayers right now. However, that is because the debt exists and is being collected on. If the debt is cancelled, wiped out, what basis does anyone have to demand it continue being paid? It is not a debt cancellation if you just move the obligation from the students to the taxpayer.

In algebra an equation stays balanced if we do the same operation on each side. Same idea in cost accounting. Subtracting out the debts on one side, and the credits on the other is a requirement of keeping the same equation or balanced books. Claiming the taxpayer must pay a cancelled debt is to prove the debt was not cancelled.

Blogger ZhukovG February 04, 2020 10:44 AM  

We must get over the idea that there is some perfect economic model that we humans can institute and maintain in this world.

The best we can do, whether the policies are 'Leftist' or 'Rightist', is the most good for the most people.

Certainly, an economy that simply funnels wealth to the 'Rentier' class is failing is this regard.

I will be interested to see what comes of Vladimir Putin's, 'State Capitalism'.

Blogger David Ray Milton February 04, 2020 10:47 AM  

I had never thought of private vs public debt in that way before. That is some pure gravy.

Blogger Станислав Бартошевич February 04, 2020 10:53 AM  

Hudson destroys his own argument. If every economy needs credit to function and grow, then your options are as follows:

(a)Have no economy, or, more precisely, no economy beyond subsistence farming level, because obviously credit is not going to appear when there is no expectation of return.
(b)Find a way to live with bankers and their depredations.
(c)Have the state as the uber-banker, providing all the credit, i.e. just ye olde state monopoly, once you cut away all the bullshit.

Reasonable people, who base their judgment on history about which we have reliable records, choose the option (b) and work from there, coming up with more or less effective measures to restrict the power of banks.

Hudson is clearly choosing the option (c), basing his argument on extremely spurious historical foundations, even though there are plenty examples from much better-known ages, showing that a state monopoly is as rapacious as a private monopoly, but has more means to enforce itself. Did USSR, where state had monopoly on banking, ever cancelled debts of the citizens? Fuck no. But it canceled its own debts to citizens twice, with savings-nullifying "monetary reforms".

Blogger Lazarus February 04, 2020 10:56 AM  

I like Steve Keen's solution of People's QE. Government ships money into peoples accounts. It is used to pay off debts of those in debt, and is just added to saver's savings.

As a saver, this would make me happy, and debtors would have their burden relieved.

Short Interview

Long interview

Blogger VD February 04, 2020 11:00 AM  

Hudson destroys his own argument.

He does nothing of the kind. Your objection is both obvious and moronic. Your conclusion is the same as the idiots who think global corporations are preferable to national governments. Moreover, an economy does not depend upon credit.

Reasonable people, who base their judgment on history about which we have reliable records, choose the option (b) and work from there, coming up with more or less effective measures to restrict the power of banks.

No, idiots who have been bought off by bankers publish spurious theories that don't hold up to simple logic, let alone the entire history of banking.

Blogger RJ February 04, 2020 11:03 AM  

"If it's not collected the money has to be made up by someone, that someone being us tax payers."

No, it doesn't. FFS, what part of "debt cancellation" do you not understand?

Let's say that you loan me $100. I can't pay you back, so you forgive the $100 debt. That doesn't mean that Vox and the others on this blog now owe you $100, and will have to pay you back.

You're not tall enough for this ride.

Blogger VD February 04, 2020 11:05 AM  

If a reset button is available then how do you prevent it from being abused? If the outcome is assured to be reset every generation then what is the point in saving or investing wisely intergenerationally?

The onus is on the bankers to not make stupid loans. There is no FINANCIAL objective to save or invest intergenerationally anyhow. That's why God commanded a debt jubilee every 50 years.

The anti-cancellation pro-usury position is overly anti-Biblical, which is why it's not a surprise that many of those who champion it are literal satanists.

Blogger Shane Bradman February 04, 2020 11:05 AM  

What is most interesting about that piece is the contrast of private and public debt, as if they are alternatives. Public and private debt are independent. Policy and lack thereof affects private debt, not the reduction of public debt. A healthy amount of public debt can lead to growth, but once growth dries up, those debts must be repaid.

Blogger Zaklog the Great February 04, 2020 11:11 AM  

usury is not freedom.

Quite the opposite, as it happens.


The borrower is slave to the lender. Debt is slavery. The teacher in Proverbs was not speaking in metaphor. This is simple literal fact.

Blogger Shane Bradman February 04, 2020 11:12 AM  

Canada78, you are retarded if you think conservatives want to prevent a "debt forgiveness abuse" and even more retarded if you think debt forgiveness is bad. Debt is the extraction of wealth from a nation. If debts are forgiven every 7 years, then bankers will stop giving long term loans. That's what we want.

Blogger Cynic In Chief February 04, 2020 11:20 AM  

There's a mechanism for debt cancellation, it's called bankruptcy. The issue with that in the US is that we've exempted student loans from it (they can't be discharged) and the government, bribed for campaign contributions by bankers, in the 2005 BAPCPA law made actual Chapter 7 liquidation and discharge bankruptcy nearly impossible for anybody who has any form of income. You have to be practically disabled and penniless to get your debts discharged anymore. Letting students discharge their student loans and repealing BAPCPA should give people in over their head a way out.

Blogger PaulSacramento February 04, 2020 11:22 AM  

Personal responsibility for debt can/may be valid when it is an option and that really isn't the case. If people don't use credit to buy a car or a home ( to use the most basic of examples), very few would buy them and how would that affect the economy?
House sales would drop tremendously, new home developments would drop, construction would suffer a missive hit, huge unemployment that would affect all other sectors.
Without credit, there is NO economy.

Blogger Doktor Jeep February 04, 2020 11:28 AM  

I look forward to the notion of student debt cancellation as being a potential element of increasing the white birth rate.
Resistance to debt cancellation based on that would be very redpilling for a lot of white people who think only whites can be racists.
And that argument will be "allowed" because it will distract from the question as to who it is actually owning the debt and making usury bucks off it.
And the first step to banning usury, albiet a small one, is to ban dual citizenship.

Blogger Tars Tarkas February 04, 2020 11:29 AM  

Wraithburn wrote:In algebra an equation stays balanced if we do the same operation on each side. Same idea in cost accounting. Subtracting out the debts on one side, and the credits on the other is a requirement of keeping the same equation or balanced books. Claiming the taxpayer must pay a cancelled debt is to prove the debt was not cancelled.

Even if both sides of the equation was cancelled, we would still have the problem of the education institutions. I, for one, would never support higher education becoming public. Without this limitation, in 20 years we will once again be talking about debt forgiveness. The universities will never just fire all of the people that need to be fired.
They need to get rid of all the sports programs too. The existence of these sports programs requires entire departments to exist, like African American Studies.
The higher education system is just fundamentally broken, like most things in society and it makes little sense to give debt forgiveness in the current environment.
The system is just incapable of the necessary reforms.

Blogger Scuzzaman February 04, 2020 11:37 AM  

But that would have helped the average American, not Wall Street bankers.

No it would have helped BOTH the average credit card debtors AND the banks they owed, whereas the bailout helped ONLY the banks.

As usual, it’s worse than you thought.

Blogger Nym Coy February 04, 2020 11:39 AM  

I don't understand the inverse link between private and public debt. Can someone explain it better? Both are high. Wouldn't both being cancelled be good?

Blogger Ominous Cowherd February 04, 2020 11:40 AM  

Станислав Бартошевич wrote:(b)Find a way to live with bankers and their depredations.
End the depredations and the bankers aren't a problem. Bankers who lend their own assets, or who act as intermediaries to lend your assets, aren't the problem. Bankers who counterfeit currency by making loans are the problem. Loaning or renting existing assets is fundamentally different than counterfeiting assets.

The key issue in the biblical prohibition of usury is whether you are harming the borrower.
VD wrote:There is no FINANCIAL objective to save or invest intergenerationally anyhow. That's why God commanded a debt jubilee every 50 years.
I think I have missed something. What do you mean by Financial objective? I think that's what I'm not understanding.

As for the jubilee, God had given every Hebrew a parcel of land, and the jubilee returned that to him or his heirs. The jubilee meant that land could be leased for up to 50 years, but could never be sold, as we understand ``sale'' today. You could squander your inheritance, but the land would be restored to your heirs.

Freeing the slaves and canceling the debts were important, too, but I think that returning the freed slave to his land was what made the jubilee work. Otherwise, the freed slave would just have to sell himself again, or starve. I'm not sure how a regular jubilee would work out in our servile society. Still, I'm pretty sure it would beat letting the banksters steal everything, which is definitely the current situation.

Blogger Dole February 04, 2020 11:42 AM  

The debt and the predatory university system must be ended. My opinion, but Trump would be smart to take up this issue.

Blogger MJ February 04, 2020 11:48 AM  

"That is because the right-wing politicians want to abolish government and the social services it provides."

Which right wing politicians is Hudson thinking of?

Blogger dc.sunsets February 04, 2020 11:52 AM  

None of this addresses the Elephant in the Living Room: Money.

When money is debt (and in a FIAT system, it IS), then as money is wealth, and debt being money, debt is wealth. This is great...until it obtains a life of its own.

A blog comment is inadequate to discuss the predicament in which we find ourselves. After five and a half decades of fiat money, raised by a high exponent by a bull market for IOU's begun in 1981, vast amounts of "wealth" is current bonds or other promises of future cash flows. Is it possible to cancel the IOU's without creating havoc among those who played by the rules and are now or soon to be dependent on those promises cash flows?

I got banned by Denninger for pointing out that while trust-busting the medical/medical-insurance cartel is essential, it will carpet-bomb our current system, and a debt jubilee is essential and it, too, will carpet-bomb the current system.

I absolutely concur, the financial/monetary system we have now has as its endgame a situation where banks foreclose on EVERYTHING, and bank owners end up holding title to what Americans near-literally PAWNED via credit cards, student loans, HELOCs, and an endless stream of municipal, state and federal bonds. This was The Big Con, instituted a century ago, and it's running BEAUTIFULLY (for the con artists.) The entire economics profession is One Big Rationalization Factory for the largest criminal fraud ever.

BUT. What is a bank deposit but a LOAN to the bank (which it subsequently loans right back out the door, multiplied tenfold (or more?) If the banks' loans are forgiven, how are you gonna get YOUR money out? You aren't. Sure, we can come up with committees and work-groups to study this, and come up with a 10,000 page legislative act to Rube Goldberg our way to "printing" enough loot to pay off depositors, and pensioners, etc., etc., and the result will be OBAMACARE again, times a thousand. Who's dumb enough to think Joe Citizen will win under that scenario?

Wealth, real wealth, is product. Product is that which can be sold at or above cost-of-production in a market. PERIOD. Money, as a stand-in for wealth, should NEVER be created by fiat (bank credit or political system chicanery.) If we need credit in an economy (and we do), then ONLY PRODUCERS should be able to create it, and then ONLY for temporary purposes. Antal Fekete's Real Bills doctrine seems promising in this regard.

Any proposed system that violates Say's Law is fraud.

We got into this mess because money was divorced from anything real. Intangible assets occupy a weird place in human cognition, allowing stupid fashions and the Madness of Crowds to run completely amok.

Any reader of this blog who does NOT understand why a bull market for debt violates Econ 101 supply-demand price models is simply too short for this ride. Unless one grasps that in markets for intangible assets rising price causes a RISE in the market-clearable quantity, one cannot remotely understand why this mess is intractable, and that it must end by passing through a catastrophe.

Blogger Fred February 04, 2020 11:53 AM  

The existential problem with debt cancellation is that those who money is lost will never loan it to a bank or government again. Since Capitalism requires borrowed money and no depositors will be forthcoming, enjoy sitting by the fire and eating tree roots, locust and honey until you starve to death in the cold. Because that is the future for all.

Blogger dc.sunsets February 04, 2020 12:00 PM  

A "jubilee" will come. The quantity of existing debt now cannot coexist with a bear market for debt. The Great Bondfire is coming, all that's unknown is WHEN.

Periodic jubilees sound great to me. Such would forestall run-away debt growth of the sort we've endured for nearly 40 years. It would make a credit-inflation mania such as this largely impossible, or at least improbable.

But we're already screwed. The current situation promises a vast collapse in wealth in the form of IOU's. Pensions, entitlement programs, bank deposits, "cash" on corporate balance sheets, you name it, it's ALL DEBT. And the quantity that exists rests entirely on a foundation of TRUST in the bankability of that dollar value under conditions of relatively stable CPI prices. This is nothing but a mass-psychological mania, related to the openness and pathological trust that underpins open borders, magic dirt and blank slate Theocratic Dogma.

It's ALL the same thing. It will all reverse together. There are no "fair and equitable" ways to dismantle it; it's like a huge fusion bomb, and proposals to disassemble it piece by piece are fantasy. The moment one piece is pulled, the bomb will detonate. The very collective decision to dismantle it will set off a race for the exits, and then we'll see how a galaxy of IOU's created over 40 years can evaporate in weeks, maybe months.

That will NOT be orderly.

Blogger VD February 04, 2020 12:01 PM  

I think I have missed something. What do you mean by Financial objective? I think that's what I'm not understanding.

In the long run we are all dead. You can't take it with you.

Without credit, there is NO economy.

That's total nonsense. It's akin to claiming "without the map, there is NO territory".

Since Capitalism requires borrowed money

It doesn't. You're a moron, Fred.

Blogger Ominous Cowherd February 04, 2020 12:02 PM  

David son of Mark wrote:I heard someone propose having student loan payments be deductible one-to-one on each persons’ federal taxes. ... Could that work?
It relieves the debtors, which is good, but it keeps the higher education/student loan scam rolling along. Higher education is a socially destructive scam which needs to be shut down, so NO, that idea doesn't fly.

Blogger Silent Draco February 04, 2020 12:04 PM  

Tars Tarkas, one essential element is a public law nullifying the court decision (Duke Power v. -----) prohibiting the use of IQ tests in making employment decisions. The college pressure evaporates that fast. Then nullify the court decision saying "you can't do that!" and the judges.

Blogger Shannon February 04, 2020 12:07 PM  

I’ve been watching a tv series called Poldark. It’s set in 1700’s in England in an era just like today. The Warleggin’s are the bankers owning all the debt and scooping up all the land and assets of the English. They are kept in line somewhat by the threat of villagers coming after them w torches and pitchforks. They feared the mob

Blogger Ominous Cowherd February 04, 2020 12:12 PM  

Fred wrote:The existential problem with debt cancellation is that those who money is lost will never loan it to a bank or government again.
That is a good thing indeed. Let them loan to a productive neighbor or to their families.
Fred wrote:Since Capitalism requires borrowed money and no depositors will be forthcoming ...
You are ignorant of history and economics.
Banksterism isn't capitalism. Banksterism is bankers stealing capital via usury.

The US had its most rapid growth when we had high tariffs and fractional reserve banking was most constrained.

Blogger CarpeOro February 04, 2020 12:13 PM  

"If a reset button is available then how do you prevent it from being abused? If the outcome is assured to be reset every generation then what is the point in saving or investing wisely intergenerationally?"

One way to look at it is through the lens of "if it is too good to be true, it probably is". The current system of junk loans is just a conman's scheme that has been dressed up and propped up by TPTB. No one looks at the loans and truly believes they would ever work out. Only by rewarding greed can a system like this exist - and it is always going to be to the detriment of the nation. There is an idea that people are in some manner not responsible for their actions - including the bankers. Bankers and politicians are the biggest conmen out there, and the entire fabric of society has been warped to support the con.

Blogger Unknownsailor February 04, 2020 12:19 PM  

Speaking as one of those who borrowed responsibly, any debt cancellation had better include cancel my debt. If it does not, I can become an irresponsible borrower in the space of a week, and then you will have to cancel my debt, too.

I understand the arguments for doing it, but those advocating for it have not given that much thought into it, all they want to do is buy future voters. This was and is the real objective for welfare, and it works.

Blogger Dan in Georgia February 04, 2020 12:25 PM  

Doktor Jeep wrote:I look forward to the notion of student debt cancellation as being a potential element of increasing the white birth rate.

Resistance to debt cancellation based on that would be very redpilling for a lot of white people who think only whites can be racists.

And that argument will be "allowed" because it will distract from the question as to who it is actually owning the debt and making usury bucks off it.

And the first step to banning usury, albiet a small one, is to ban dual citizenship.


I see this happening right now. Women are working into their 30s until it becomes very difficult to have children at all, let alone several. Student loan jubilees would immediately allow families to buy houses and start families. It's the single best thing we could possibly do to save our nation going forward.

Blogger LiveForever February 04, 2020 12:27 PM  

@61
Your individual financial prudence is irrelevant in the long run. You will still suffer if there is no debt cancellation, whether you have paid off your own debt or not. Did you even read what Vox wrote? This isn't that hard to understand.

Blogger peacefulposter February 04, 2020 12:29 PM  

Just don't cancel my replicator rations.

Blogger Silly but True February 04, 2020 12:30 PM  

I have little empathy for majority of the participants in US 2008 financial crisis. The main drivers of the worst impacted States were affluent upper-middle class households instead of paying of perfectly fine & reasonable 30-year fixed mortgages refinancing to stupid mortgages to ridiculous levels to buy much larger houses than they needed to keep up with the Joneses. 2009-2010 offered people doing things the right way looking to get into home under traditional 30-year fixed terms with some down payment tremendous opportunity to capitalize on their stupidity.

The problem wasn’t entirely banks in 2007-2008 throwing cash around they shouldn’t have been throwing around. At least half (if not more) were the people willing to take it.

Blogger ZhukovG February 04, 2020 12:31 PM  

Some, it seems, are arguing in favor of the people who rob them. "Here banker, take my money! God forbid a farthing should help my countrymen!"

It's not difficult.

As a foundation the levers of the economy should be in the hands of those who are answerable to the Nation(People).

Banks that make bad loans fail. Any assistance will go to those who deposited in good faith.

Usury shall be a felony.

Voting rights shall be restricted to those not receiving government assistance.

Blogger mgh February 04, 2020 12:33 PM  

VD says: "The onus is on the bankers to not make stupid loans." Therefore in a jubilee system most loans would be relatively short term. I see nothing but positive outcomes from that. In my own experience, having muddled through life paying off multiple smaller mortgages in under 10 years, I have come to understand that one's goals can change greatly every 7-10 years, so the 30 year mortgage is an unnecessary restriction on peoples choices in life.

Blogger Wraithburn February 04, 2020 12:35 PM  

Tars Tarkas wrote:The higher education system is just fundamentally broken, like most things in society and it makes little sense to give debt forgiveness in the current environment.

"We are in a car careening towards a cliff with the gas pedal held down. It just doesn't make sense in this environment to hold down the brakes if nobody will take their foot off the gas!"

There is no room for blackpilling here. Convincing ourselves that we can't even take the first step of a campaign because there are more steps to take afterwards is loser talk.

Blogger tdcommenter February 04, 2020 12:41 PM  

@53 Capitalism works with cash or specie, and without debt or credit. In the very best scenario, credit and debt acts as a lubricant to transactions. A little bit does wonders.

Blogger PaulSacramento February 04, 2020 12:42 PM  

Without credit, there is NO economy.

That's total nonsense. It's akin to claiming "without the map, there is NO territory".


Allow me to clear that up:
Without debt, the current economic model can't exist.
The cost of products like houses, apartments, cars, the current price levels assume credit.

One can argue that debt forgiveness is the best way to stimulate any economy BUT what cycle would you be using? the 7 year one the OT ? the 49 Year one ? somewhere in between?
A once in a lifetime debt forgiveness?

Blogger Tars Tarkas February 04, 2020 12:42 PM  

Unknownsailor wrote:Speaking as one of those who borrowed responsibly, any debt cancellation had better include cancel my debt. If it does not, I can become an irresponsible borrower in the space of a week, and then you will have to cancel my debt, too.

Instead of looking at it as a gift for irresponsible people, look at it as the gift of civilization to everyone. Because this system is going to fail if all of these problems are left completely unaddressed. Nobody knows when or what could spark it, but things that cannot go on forever eventually stop.
If done properly, debt forgiveness would wipe out a large part of the wealth of the banksters and crooks. "Irresponsible people" who owe a lot of money owe that money to someone. It will be those people who get screwed, not you.

Silent Draco wrote:Tars Tarkas, one essential element is a public law nullifying the court decision (Duke Power v. -----) prohibiting the use of IQ tests in making employment decisions. The college pressure evaporates that fast. Then nullify the court decision saying "you can't do that!" and the judges.

That might help with runaway credentialism, but it is not going to help all of the structural problems we have.

Blogger Doktor Jeep February 04, 2020 12:43 PM  

BTW, the "I paid my debt why should anybody else get theirs cancelled?" argument is boomer tier "I got mine".

Blogger Azure Amaranthine February 04, 2020 12:44 PM  

"What happens when a government runs a surplus? That means that it doesn’t spend money into the economy. The economy has to rely on banks to get credit, because every economy needs credit to function and grow. Bankers realize that if the government doesn’t provide the economy with money – by spending deficits into the economy to promote employment – then people will have to borrow from the banks."

This can only be a serious problem if the gov is too directly "involved" with the "money" supply, AKA corrupt.

"Bankers will end up with the houses, and with private industry. They will end up controlling everything, including the government."

Instead of being covertly in bed with each other, and even more secretly controlling it anyway, just with a lot of layers of propaganda and deniability....

"Will it be democratic governments or wise rulers seeking stability and military security? Or, will it be a financial oligarchy that wants to get rich by impoverishing the rest of society?"

Although, said democracy is little more than a facade for oligarchy.

"The inexorable math of usury and the way in which credit shifts the demand curve upward dictates that however "responsible" your economic decisions are, sooner or later you will be forced to not only "subsidize the self-indulgent and/or foolish economic decisions of others", you will be forced to make equally foolish decisions yourself."

DING DING DING!

Also spoken as "bad money drives out good", "slave owners undercut free men", and "fake demand still raises prices for real demand".

You fuckers complaining about not having borrowed, or being allowed to borrow irresponsibly yourselves:

#1: That's the exact same argument as "someone's eventually going to do evil thing X so it might as well be me doing it first."
#2: You're not going to be the one paying for it. If anything, it will lower your financial burdens. The userer stains will be the ones paying for it. Some temporary instability will obviously be required to force that.

Blogger Azure Amaranthine February 04, 2020 12:47 PM  

And no, I don't owe a single cent of debt to anyone for anything.

Can it be said about the jackanapes who have responded and will, that they have no investment in the current debt system? Investment goes both ways. You don't just own it, it owns part of you too.

Blogger Bert Head February 04, 2020 12:49 PM  

"Without credit, there is NO economy."
Obviously not. Without credit there is no bubble. PaulSacramento just described the collapse of bubbles. They will do that of their own accord eventually. Without usury there is no bubble economy.

Blogger Rakshasa February 04, 2020 12:54 PM  

Debt cancellation is only a good thing if the the right people take the loss.

These days with the transfers of debt to the state, and thus the populous, and inflation, debt cancellation seems more like another way of increasing the velocity of wealth transfer.

Blogger DannyDanger February 04, 2020 12:57 PM  

This particular issue of student loan debt forgiveness which Vox has addressed previously went a long way to exposing some inner demons that I was completely unaware existed. Like many others, I am one of those who sacrificed and scrapped to pay off debt, often in contrast with others who casually kicked the can while living more extravagantly.

Because of this, the idea that "they" could get away scott free after making all these bad choices while I had made the "right" choices struck me as fundamentally wrong. This was before I began to examine the root cause of this feeling, which I can see clearly now was evil within me. The reality is that the "irresponsible debtor" and I were both victims of the same scheme of usury. Just because I had worked harder to get out from the thumb of the usurers does not mean that others who did not work as hard should be subjected to more evil because of some messed up egalitarian belief that the pain should be dolled out proportionally. It's shameful now to think that was what I believed in one way or another; I was living with a spirit of resentment and not forgiveness.

It's black and white: right and wrong. I thank Vox for calling this out and freeing me from some of the bitter evil that comes from being victimized in this way. While the irresponsibility of others is clearly a bad thing and should be condemned, we should not answer that by throwing them to the wolves who are the root of the problem to begin with.

Blogger Snidely Whiplash February 04, 2020 1:01 PM  

Doktor Jeep wrote:BTW, the "I paid my debt why should anybody else get theirs cancelled?" argument is boomer tier "I got mine".
It is nothing more than envy, masquerading as a plea for justice.

"The factory's on fire, we need to unlock the doors and get people out!"
"Hell no! They need to earn their retirement like I did. It's working hours, get back to work!"

Blogger VD February 04, 2020 1:05 PM  

The cost of products like houses, apartments, cars, the current price levels assume credit.

What on Earth do you think "credit shifts the demand curve upward" means? Do you honestly believe you are telling me anything I didn't know 30 years ago?

Blogger dc.sunsets February 04, 2020 1:06 PM  

What happens if (perhaps) a quadrillion dollars in debt is extinguished?

What happens to prices for goods and services?
What happens to employment conditions?
What happens to tax receipts?

Today, the City of Chicago (run by known deadbeats) can float bonds secured by future tax revenue, and bond buyers (pension funds, mutual fund managers) can't get enough of the junk IOU's. Why? No one cares about the future. Today, the manager needs to show yield. If the market holds together, he keeps his highly remunerative job. If the market detonates, he was going to be out of a job ANYWAY.

This is but one aspect of the perverse incentives that have fueled the largest buildup of debt in recorded history. Wealth, in the form of debt, has skyrocketed since the bond market low of 1981. Bond prices then rose (bull market, duh!) and as they rose, MORE debt was demanded so borrowers multiplied like rabbits. Only a few individuals now pay off their debts. Every other entity (governments, corporations and individuals) simply rolls existing debts over, and as rates fell (because prices rose), they could borrow more and more and more at the same interest expense.

For every dollar borrowed-and-spent, at least two dollars in WEALTH was counted: First, a dollar was spent into the GDP-counting economy, and produced wealth at the velocity of that dollar in changing hands. But a SECOND dollar was added to the bondholder's balance sheet as an ASSET.

How did this make sense? Because that's how markets for intangible assets work. How much would just a hundred trillion dollars of cash, in 100 dollar bills, mass? Do. The. Math. Then compare it to the displacement of the largest oil supertankers in existence. I think it works out to like 60 of them, fully loaded, parked end-to-end. Can you SEE this in your mind's eye?

Me neither. Intangible things are almost impossible to think about in concrete terms. This is why markets for intangible assets fluctuate wildly over long periods of time. The bond market has been in Bull Mode for 39 straight years. As prices rose, collective trust in the quantity brought to market actually rose, too. This is absurd. If your brother-in-law borrowed $10 grand from you weekly, at some point might you begin to question the trustworthiness of his IOUs? Especially if, mathematically, it was increasingly absurd to imagine he could satisfy them all?

All roads lead to a collapse of this Ponzi. I suspect even the architects of this con job are increasingly fearful that they'll be victims of their own success, because when the markets fall and all this credit inflated wealth simply evaporates, and the bankers are all sitting pretty on what collateral exists for that debt, the mob will tear them limb-from-limb.

We were all sold lies, rationalized by industrial-scale sophistry in every Economics Department of every university. We were promised something for nothing, and we all signed up. That's what herds do. It's a law of human nature, a defect, if you will, of human cognitive processes. We live in historic times.

Blogger Patrick Kelly February 04, 2020 1:06 PM  

RJ wrote:"If it's not collected the money has to be made up by someone, that someone being us tax payers."

No, it doesn't. FFS, what part of "debt cancellation" do you not understand?

Let's say that you loan me $100. I can't pay you back, so you forgive the $100 debt. That doesn't mean that Vox and the others on this blog now owe you $100, and will have to pay you back.

You're not tall enough for this ride.


No, that's not how it works with gov't guaranteed student loans.

Student applies for gov't guaranteed loan, gov't pays bank the money to loan to the student, bank lends money to student, student pays school, now they both have their money. If the student defaults or the debt is "cancelled", the loan was guaranteed by the gov't *with money that came from taxes*. At this point the taxpayer did pay the debt, the taxes were already collected and paid to the bank.

Now the gov't uses the IRS to try and collect the money from the student. If they can't, the tax money that was used to pay the bank has to be made up with more taxes.

Blogger Azure Amaranthine February 04, 2020 1:09 PM  

"Unfortunately, we live in clownworld and so debt relief would be done through the Democrats and would be framed, and probably structured to most benefit blacks, browns and women."

Then create your own synthesis of how it ought to be done and promulgate that instead, or find someone else's who you can agree with and help with pushing theirs forward.

"If a reset button is available then how do you prevent it from being abused? If the outcome is assured to be reset every generation then what is the point in saving or investing wisely intergenerationally?"

Do you think the banksters would allow debt to stay out forever if they knew it was going to be canceled eventually? No, they'd either set up to recollect on all of it before the cancellation came down, or not lend beyond means in the first place. Your problem solves itself by forcing lenders to actually lend responsibly.

"this mess is intractable, and that it must end by passing through a catastrophe."

We can modify who is worst hit.

"It's ALL the same thing. It will all reverse together. There are no "fair and equitable" ways to dismantle it"

Dismantling it period is preferable to letting it run. You've bought into a lie, that we aren't already impoverished, aren't already feeling it. All the negative consequences are here already, they're just obscured and redefined until people don't notice them.

"That will NOT be orderly."

Which is why looters are shot on sight. Everyone finally feels the sting and recognizes the fire that has been consuming them all along, but at least the flame is extinguished. Strong hands needed to maintain and create stability. Strong hearts needed to even try.

Blogger Balam February 04, 2020 1:15 PM  

Doktor Jeep wrote:BTW, the "I paid my debt why should anybody else get theirs cancelled?" argument is boomer tier "I got mine".



There is quite a lot of it being posted. It's like living in a landfill and opposing public action to clean it out because you, yourself, didn't litter. "Hey why should others get to live in a clean neighborhood when I kept my space clean". You still live in a landfill, no matter how clean your surrounding 10x10ft of space is.

Similarly the mountains of debt lead to a worse living environment such as high housing prices, car prices, unemployment, increased homeless and on and on. It shapes the neighborhood you live in and even for the selfish sake of living in a nicer place people should want the debt jubilees. Like someone said in a previous post it's envy that keeps one from wanting others freed from debt not self-interest. Self interest is wanting your neighbor NOT to stab you over your wallet because he can't afford his house and needs to feed his compensatory opiate habit.

Rakshasa wrote:Debt cancellation is only a good thing if the the right people take the loss.

These days with the transfers of debt to the state, and thus the populous, and inflation, debt cancellation seems more like another way of increasing the velocity of wealth transfer.


What more do average people have to lose? "The average American now has about $38,000 in personal debt, excluding home mortgages.". I can't imagine people being worse off unless they are in even more debt or if their environment gets materially worse. Would you mind outlining how debt cancellation could transfer wealth faster without making the cancellation an outright lie?

Blogger dc.sunsets February 04, 2020 1:19 PM  

People get confused about debt.
Borrowing pulls future demand into the present. Since the future cannot be consumed (it hasn't been created yet), all consumption is in the present. An exponentially-growing debt bubble thus creates OVER-consumption of the present.

We have too much University Education being offered and consumed.
We have too many cars being produced and consumed.
We have too many hospitals and doctors and nurses, etc. being paid for by government borrowing.

All of this is like a social club renting a farm for a party. They burn the kindling and pop the popcorn, but when it's all gone, the party-goers don't want to go home, so they cook the seed corn, slaughter the breeding stock for bacon and break up the barn for kindling on the bonfire, promising the farmer that they'll replace it all next week. The problem is, none of the party-goers has seeds or livestock or a barn, and it turns out that EVERY FARM has the exact same kind of party going on it now.

We're consuming capital. Excess debt issuance has to consume SOMETHING, and capital is what it is. What is the reward today for creating capital? ZERO. Why? Because your competitor can go to a bank, and the bank can "create capital" from thin air, via the simple act of lending. When credit appears from thin air, it SPENDS just like real wealth, so it dilutes the value of creating real wealth.

"In order to consume, you must first produce." Or, "Production MUST precede consumption." Modern banking under fiat money openly violates this (Say's Law), giving "approved persons" the ability to create "demand" (credit) from NOTHING, and then lend it, and CHARGE RENT ON IT.

What. The. F***???

We live in the shadow of Mt. Vesuvi-debt because of this con-artistry. The debt is the outcome...but the disease is naked credit creation.

Blogger PaulSacramento February 04, 2020 1:36 PM  

VD wrote:The cost of products like houses, apartments, cars, the current price levels assume credit.

What on Earth do you think "credit shifts the demand curve upward" means? Do you honestly believe you are telling me anything I didn't know 30 years ago?


Sure, I don't doubt many know that BUT how do you address it?
Forgiving debt when cost of living is very low, when unemployment is very high, when the economy is already a horrific mess is one thing.
What kind of issues would people face if their debt was forgiven BUT a house still caused 1 million dollars?

Blogger Ominous Cowherd February 04, 2020 1:39 PM  

I have been debt free for more than a decade now. A jubilee would not benefit me directly.

A jubilee would damage my enemies and yours, so I am in favor of a jubilee. A jubilee would be a big step toward restoring our society, so I am in favor of a jubilee.

A jubilee would not benefit me directly, but indirectly it benefits us all.

Blogger Newscaper312 February 04, 2020 1:39 PM  

@79 Yes. And for a given supply hihger demand means higher price. Removing the easy credit should result in a new equilibrium at some point where somewhat fewer can afford, but the new price should also be lower.
Once prices find that point, you would probably find that some people who initially fell in the gap caused by disruptive removal of easy credit and were unable to buy, would in fact later be able to buy at that new lower price after all.

Blogger mgh February 04, 2020 1:40 PM  

Dan in Ga said: "Women are working into their 30s until it becomes very difficult to have children at all, let alone several." My wife dropped out of work and stayed home until the kids were of school age, and then worked at the school. We were surprised at the high percentage of women who had kids and told her they wanted to stay home too. Only a tiny percentage followed through. They were enslaved to their long term mortgages and car loans.

Blogger Johnny February 04, 2020 1:41 PM  

The coincidence of an industrial society and fractional reserve banking is so good that it may not be possible to run an industrial society without banks. Well, semi industrial, but you never really get going.

When a government guarantees a loan that it unlikely to be paid back, what is actually going on is that it is off the books spending. The spending turns up in the present, the loan a covert form of spending that 'looks' like a private borrowing. If we forgive student debt without fixing the situation that creates it, one outcome will be a government that is even more fiscally irresponsible than it is already.

The government now backs a lot of debt, here and there and everywhere. They don’t always officially admit they are doing it, but if the loan going bad will produce financial instability, they are locked into backing it up regardless.

We will probably forgive the debt regardless, because it never gets paid and runs on into eternity with interest of course, or inflation chews up its value. But bet you if we do forgive it formally, it will be when we are heading for financial instability, or already into it. Government sponsored bad loans are another form of what people choose to call money printing. Unbacked debt. When some agency comes up with the power to issue unbacked currency, it is really never done in a responsible way.

Blogger Dan in Georgia February 04, 2020 1:48 PM  

This will make for an epic Darkstream. Boomers minds will be blown.

Blogger IAMSpartacus0000 February 04, 2020 1:53 PM  

The bank system and credit/debt essentially mean you cannot be responsible and succeed. Even if you do it right only the bank wins and you will still just hope you can live above the moving edge of economic viability.

At some point the debt bubble grabs everyone except the bankers.

Blogger Brian Niemeier February 04, 2020 1:57 PM  

It's hard to avoid the conclusion that Conservatives only oppose abortion because they wish to keep their children as debt slaves.

Sacrifice to Mammon instead of Moloch.

Blogger Dyspeptic February 04, 2020 2:03 PM  

"That is because the right-wing politicians want to abolish government and the social services it provides."

This is a breathtakingly stupid statement and makes me wonder about everything else Hudson has to say. Basically he is saying right wing ideology=Anarchy. Does anyone here buy that?

"For instance, in the United States, President Clinton finally ran a budget surplus in the last year of his rule."

If you believe the Federal Governments warped and thoroughly dishonest accounting practices that might be true but I have my doubts.

Blogger dc.sunsets February 04, 2020 2:06 PM  

Snidely Whiplash wrote:Doktor Jeep wrote:BTW, the "I paid my debt why should anybody else get theirs cancelled?" argument is boomer tier "I got mine".

It is nothing more than envy, masquerading as a plea for justice.

"The factory's on fire, we need to unlock the doors and get people out!"

"Hell no! They need to earn their retirement like I did. It's working hours, get back to work!"


Let me get this straight.
Boomer: "I paid off my debt, lived frugally, worked two jobs to save, put my money in the bank, and now that my age prevents people from hiring me, I intend to live on that savings and whatever modest future cash flows were promised me."

Snidely: "F-Y, Boomer. We're going to make it so your bank can't collect on IT'S debts, so your savings is gone. AND we're not gonna pay you jack on pensions; pensions (and SS) are Boomer-isms (meaning, I don't have a pension, so let's burn yours, too) so F-Y, sell your house and go live under a bridge, or mooch off your kids if they'll have you."

I'm among the relative few who has not only a Plan A, but also a Plan B and even a Plan C. If things change (and they likely will) I hope to avoid abject poverty in old age. But I so, so, so tire of the Politics of Envy that are Millennials griping about how the Boomers all plundered the buffet and there's nothing but a bunch of iPhones left.

*Everybody's* going to get hammered when this clown-merry-go-round stops turning, none more so than your parents' generation who hold all the debt and stock (and homes) slated for a collapse in monetary value.

If that makes you happy, I'm glad we're not neighbors.

Blogger Unknownsailor February 04, 2020 2:09 PM  

Snidely Whiplash wrote:Doktor Jeep wrote:BTW, the "I paid my debt why should anybody else get theirs cancelled?" argument is boomer tier "I got mine".

It is nothing more than envy, masquerading as a plea for justice.

"The factory's on fire, we need to unlock the doors and get people out!"

"Hell no! They need to earn their retirement like I did. It's working hours, get back to work!"

And what will be the reaction of the responsible when they see the irresponsible get the consequences of their irresponsibility nullified? Yes, everyone benefits under debt reduction, but I don't see any accounting for the reactions to the event.

Also, speaking as an accounting minor, debt forgiveness is treated as income by the IRS. This brings the question of whether Millennials/Generation Z handle a $40-60k lump sum income tax consequence of their student loan forgiveness in one year, or would they have to go into debt to a different creditor to pay of the debt forgiveness for their previous creditor? I suppose just getting out from under the inviolability of their student loans would be a benefit, and the amount would be a lot less, but they still would wind up in a similar (but much less extreme) situation.

Blogger ODG February 04, 2020 2:11 PM  

Those of us who, like DannyDanger and myself, are feeling like the Ants watching the Grasshoppers get a bunch of food even though they didn't work for it, might take some solace in the fact that our hard work produced in us some intangibles that can't be gotten by any "Grasshoppers".
I apologize for the out-of-context Scripture, but it popped up in my "Verse of the Day", and it struck me as appropriate:
“Not only that, but we rejoice in our sufferings, knowing that suffering produces endurance, and endurance produces character, and character produces hope, and hope does not put us to shame, because God's love has been poured into our hearts through the Holy Spirit who has been given to us.”
‭‭Romans‬ ‭5:3-5‬ ‭ESV‬‬

Blogger Noah B. February 04, 2020 2:11 PM  

"Without credit, there is NO economy."

This is the true mark of the slave. He is so conditioned to accept his servitude that he cannot imagine any other possibility, such as an ownership society wherein practically everyone has savings and government has no involvement with the collection of loans.

Blogger Rek. February 04, 2020 2:14 PM  

In 30 years of going to church, never ever have i heard even a word about usury. Disgrace.

Blogger Cinco February 04, 2020 2:14 PM  

If the devil walks the Earth, and a man can not have two masters, it is unlikely we see debt forgiveness at this point. Would I support a jubilee, sure, why not at this point?

However, as a person who has lived his entire life near debt free, this really rubs me raw. Out of curiosity, what is the recidivism rate on credit card debt? I bet it’s little different than a degenerate gambler.

Blogger Newscaper312 February 04, 2020 2:18 PM  

@88 mgh
"We were surprised at the high percentage of women who had kids and told her they wanted to stay home too. Only a tiny percentage followed through. They were enslaved to their long term mortgages and car loans."

Also don't forget much higher taxes than 60 years ago - at least for that part of the population in that gets stuck paying them (not the poor or lower middle class, not the 'rich' who can afford avoidance).

Blogger Noah B. February 04, 2020 2:19 PM  

That's some blessed healer tier kvetching, dc.sunsets

Blogger Azure Amaranthine February 04, 2020 2:23 PM  

"But I so, so, so tire of the Politics of Envy that are Millennials griping about how the Boomers all plundered the buffet and there's nothing but a bunch of iPhones left."

"F-Y, Boomer. We're going to make it so your bank can't collect on IT'S debts, so your savings is gone."

The savings that were comparatively easily garnered and are intended to be consumed in toto often with no inheritance for their offspring? That's exactly what should happen. If they had kids and took care of their kids their kids wouldn't mind taking care of them when it's time. If they didn't, they have it coming. I don't have to like it to say that they deserve it.

My parents took care of us and I will personally ensure that they are taken care of. Any questions?

Blogger dc.sunsets February 04, 2020 2:24 PM  

BTW, Hudson reveals his biases: he uses the term right-wing (as a pejorative each time) 7 times. Left-wing...(crickets)....zero.

He conflates "benevolent" rulers of Antiquity with today's (presumed) crony-capitalists/oligarchs, but he never seems to say WHOSE faces are in the Group Photo (Soros et al.) Even Haaretz had an article about how 50 of the top 100 US campaign contributors in 2016 were Those Who Can't Be Criticized.

For all Hudson's scorn for the Austrians, he seems blissfully ignorant of Hoppe's juxtaposition of democracy vs monarchy (renter behavior vs the behavior of an owner) and shows no notice that I can find that the nature of money is central to this issue. Money as it stands now is a medium for enabling Asset-Stripping con-artistry. If Hudson believes that handing Congress (or any ELECTED officials or appointees thereof) the means to play banker and issue money to their hearts content will yield Good Things, he's a complete fool. All of Tocqueville's observations about democracy, and voters discovering they can loot the public treasury via ballot, would simply hasten the demise of what little republic remains. Replacing the bankster-looters with legions of shiftless "voter-looters" wouldn't change the eventual effect: collapse, followed by dictatorship.

Que sera, sera. What will be will be. The future is already baked into this cake. I may not like the ingredients, but none of us chooses the times in which we live.

Blogger Kentucky Packrat February 04, 2020 2:29 PM  

"I did the right thing, you'd better not punish me too." OK, people let's go to the Bible.

God told Israel to have the Jubilee and the Sabbath years. There is no record that Israel ever had a single Sabbath year, and certainly never recorded a single Jubilee. God finally let Assyria and Babylon take Israel and Judah, and had the prophets say "If you won't give the land rest, I WILL."

Teachers can scream that Illinois owes them a pension, and they're right, the state does. However, Illinois is functionally insolvent/bankrupt. When a debt can't get paid, it is gone.

The world economy is functionally bankrupt, and the US especially so. We can either execute some form of jubilee and recognize that the debt will never get paid in a controlled fashion, or we can let people get so desperate that they will happily go French Revolution/Russian Revolution on those who do produce. Think about Egypt in 2011 and afterwards: it takes incredible incentive to consider picking up an APV and throwing it off a bridge. Do you really want to see that kind of desperation in the US?

Blogger Snidely Whiplash February 04, 2020 2:36 PM  

dc.sunsets wrote:*Everybody's* going to get hammered when this clown-merry-go-round stops turning, none more so than your parents' generation who hold all the debt and stock (and homes) slated for a collapse in monetary value.
My parents' generation is dead. My own generation needs to be asset stripped and turned out into the fields to glean, so that their grandchildren can have the future that Boomer greed is denying them.

Blogger Wraithburn February 04, 2020 2:40 PM  

mgh wrote:They were enslaved to their long term mortgages and car loans.

To quote from Hudson's book, "One version of the reform text stipulates: "As for women of former times -- a man (could) take two of them; but for women of today -- indemnity payments (for debt?) have been removed (and the practice has been abolished)."[183] This seems to refer to women pledged to creditors as debt servants, and hence belonging to two men: her husband and the creditor, "so that she had for all practical purposes, marital obligations to two men."[184]"

It would change our society dramatically if most families did not need two income streams to pay their litany of debts.

Blogger Snidely Whiplash February 04, 2020 2:40 PM  

Unknownsailor wrote:And what will be the reaction of the responsible when they see the irresponsible get the consequences of their irresponsibility nullified?
They'll stop loaning money, which is the desired end state. Objective achieved.

Blogger OneWingedShark February 04, 2020 2:43 PM  

Patrick Kelly wrote:"…suddenly the taxpayer will pick up the tab…."

We already picked up the tab.

Multiple times: the airlines post 9/11, GM, the housing-crisis… and those are just the ones off the top of my head and that I remember happening.

Blogger dc.sunsets February 04, 2020 2:43 PM  

@82 Azure, if you think that a committee the size of what's in Washington DC is going to produce ANYTHING useful or coherent regarding choosing winners and losers in a debt-cancellation, I have a bridge to sell you. (It's right here on this picture-postcard.)

Heck, if the problem was limited to a small town of the size in which I live, it would still be intractable. It's NIMBY^80

The USA is completely and utterly dysfunctional at over 300 million geographically, culturally, ethnically and racially disparate people. Every attempt to find "consensus" will see opponents organize and go to WAR, no matter how it's structured. Only a totalitarian dictatorship could pull off such a stunt...and maybe not even then.

A system of people this size operates like a single organism, which is why it behaves like any complex system: it is the definition of "spontaneously organized."

I can better understand the bat-guano crazy that is "gender dysphoria" than I can someone who thinks that mass politics is coherent.

Blogger PaulSacramento February 04, 2020 2:51 PM  

"Without credit, there is NO economy."

This is the true mark of the slave. He is so conditioned to accept his servitude that he cannot imagine any other possibility, such as an ownership society wherein practically everyone has savings and government has no involvement with the collection of loans.

Perhaps, but a slave that is mortgage free with a house valued over 1 million.

Never confuse what a person sees as observable fact to that person being a "slave" to that fact.

The economies of the developed nations are based on the debt and credit.
That is how governments run countries, that is how people run their lives.

Does it need to change? of course. Will it? eventually, to one degree or another.
Completely?
Only when economic collapse happens.

People don't like buying a 800K house, but they do.
They like buying new cars and all the people that build cars are all the happier to build cares that sell for more than people can pay cash for.
Forgive debt?
Sure, for how long? how many times? and what happens after ?

Blogger dc.sunsets February 04, 2020 2:53 PM  

Well, Snidely, when your grandkids come to turn me out into the field (wilderness), hopefully my grandkids' aim will be true.

I have no questions that can be answered (by you, me or anyone.) I have hope and I have love. I have a kernel of knowledge. This discussion, like so many others, is naught but a parlor game. Life's not a Chinese menu, and the world works the way it works because Nature's Laws are inviolable, and Mankind is OF nature, not above it. I no longer tilt at windmills.

Blogger Daniel Heneghan February 04, 2020 2:54 PM  

>>Canceling the debts created the German Economic Miracle...

And that's the problem. The last thing America needs right now is some "Economic Miracle", booming economy, rising tide, 4% annual growth, blather, blather, blather......because such will only encourage the cucks to accelerate their race replacement schemes, and this is the heart of the matter, of ANY matter. And nobody here - not even 20 million of you standing shoulder to shoulder - has the capability right now to withstand the cucks and their lies, their deceit, their false promises. You are just too damn weak, inarticulate, unmotivated, cowardly. Hell, give a cuck 4% growth rate and he's off, he's all over you, he even suckers some of you to his side: "The economy, the economy we need more workers or the economy will fail, blather, blather, blather. Guest workers! Guest workers, and they will have to go back after their contract is up, blather, blather, blather..." And every head-up-his-ass American falls for this con.

Yeah, I know, the cucks will continue with their war against America notwithstanding, but with a long-term contracting economy we may actually get some resistance to their schemes and after many very hard years, just possibly the people will see and understand the big picture and form convictions of resistance. (I dream).

What we need is a contracting economy, forty year recession, diminished capabilities, things falling apart....I would rather live in a second rate, olde America (I know that things have gone too far for that to ever come back, but I will be grateful to preserve what we have right now), than a hyper-competent, techno-capital, Asian-esque, cultural and moral dystopia. Take me back to West Virginia. I'm serious.

So, no. No friggin' debt forgiveness. They must suffer. We all must suffer. Suffering concentrates the mind as to who is causing one pain. Suffer. It is for their own good. It is for our good. It is for the good of their families, their people, their nation. Lessons learned hard are lessons learned well.

Besides, the indebted can be men and just walk away from the debt. Live with the consequences of that, maybe press the Law to change so that the matter can be litigated in bankruptcy court, or barring that, live the life of a rebel on the periphery of the financial system. Teach their children to be tough, thrifty, restrained, faithful, cunning, unyielding, mistrustful. That will learn them some hard but useful lessons.

No debt forgiveness. Fight. Resist. Suffer. Win.

Blogger Ominous Cowherd February 04, 2020 3:02 PM  

dc.sunsets wrote:Boomer: "I paid off my debt, lived frugally, worked two jobs to save, put my money in the bank ...
Hard work and frugality is not evil. Pride and envy, and a hateful disregard for current debt slaves and for the social evils debt slavery causes are evil.
dc.sunsets wrote:
Snidely: "F-Y, Boomer.

I second that. F-Y, Boomer.

Blogger Dan in Georgia February 04, 2020 3:02 PM  

Rek. wrote:In 30 years of going to church, never ever have i heard even a word about usury. Disgrace.

Yeah, it leads to a lot of uncomfortable truths about Our Greatest Ally, the Only Democracy in the M.E.

Another consequence of Churchianism.

Blogger SciVo February 04, 2020 3:04 PM  

FWIW, I agree wholeheartedly. With the bank bailouts of 2008, there is already no personal responsibility; that ship has sailed.

Indeed, it is possible that normalizing mortgages to the true home values would have been even better for the banks (in the long run) than bailing them out directly; in practice, "personal responsibility" is just a shibboleth, an excuse for doing whatever would hurt the little people the most, even if it's worse for the economy -- even if it's worse for the elites.

Because really, everything is relative.

Blogger Silly but True February 04, 2020 3:09 PM  

Unknownsailor:
“And what will be the reaction of the responsible when they see the irresponsible get the consequences of their irresponsibility nullified?”

You might have one or two people pissed off enough to shoot up their bankers, but they will be demonized and made examples of.

But clearly there won’t be, say, any widespread movement of Directors, Regional Managers, House Counselors, architects, engineers and plant managers who, say, go on a “knockout game” against millennial women's studies and Renaissance history majors that received jubilee forgiveness. That’s a romantic fantasy.

Blogger Primus Pilus February 04, 2020 3:20 PM  

I never really viscerally despised BoomerCons until seeing their responses in each of Vox's debt-forgiveness threads. Like I've mentioned before, they really do hate the idea that anyone under 50 might be able to afford to raise a family and purchase a home. They not only want their people and civilization erased, they actively work towards it.

And they always drip with envy regarding "Well, I was responsible and paid MY debts!". Not only is this shortsighted and vile, but it's also a lie.

The modern student loan scams didn't exist when Boomers were in school. The massive inflation in homes, cars, all major assets had barely gotten off the ground when they were young.

These locusts never had to deal with the crushing debt the generations after them have had to deal with, they all thrived off the financialization they saddled their children and grandchildren with, and now they cry "Fairness! Responsibility!" to try to obfuscate their crimes against their own descendants.

Brian Niemeier wrote:It's hard to avoid the conclusion that Conservatives only oppose abortion because they wish to keep their children as debt slaves.

Sacrifice to Mammon instead of Moloch.


Conservatism has always been the heat sink to the Leftist political machine. It's never been right wing.

Blogger VD February 04, 2020 3:22 PM  

Perhaps, but a slave that is mortgage free with a house valued over 1 million.

And the real reason for your concern about knocking out debt support for the propped-up house prices reveals itself....

Blogger Tars Tarkas February 04, 2020 3:41 PM  

Azure Amaranthine wrote:"Unfortunately, we live in clownworld and so debt relief would be done through the Democrats and would be framed, and probably structured to most benefit blacks, browns and women."

Then create your own synthesis of how it ought to be done and promulgate that instead, or find someone else's who you can agree with and help with pushing theirs forward.


You would simply have to entirely eliminate gov backed loans and grants AND eliminate foreign students.

The colleges must have the funding cut. They have spent the last 50 years growing the institution.
But it is not likely that the colleges will fire everyone who needs to be fired. What they are far more likely to do is cut across the board (all depts equally) or, worse, eliminate departments that are smaller, but far more important than the women's studies dept.

I'm not advocating or opposing anything other than not nationalizing higher ed. The system is hopelessly corrupt beyond deliberate and conscious reform. It's not just them. This thinking exists across institutions. When big corporations do layoffs, it's rarely human resources that gets the axes. It's the people who generate billable hours who get axed.

Blogger Ominous Cowherd February 04, 2020 3:49 PM  

PaulSacramento wrote:What kind of issues would people face if their debt was forgiven BUT a house still caused 1 million dollars?
Want to sell your house? You will price it affordably, or no one will buy and you won't sell.
Only an idiot would imagine that prices for existing stuff will stay above what people can afford.

Blogger Ariadne Umbrella February 04, 2020 3:50 PM  

Everybody is leaving out the obvious method for knocking out student debt: clear out the private endowments of universities: the Henry the 8th option. It worked.

And, right now, most businesses are not starting with public financing or debt: they are privately held. The clear thought to financial types- they give interviews- is that the casino nature of the stock market, with the insiders making so much- is that most of the value of the company and growth is when it is not sold on the stock market, but before, when its privately held. The stock market is to fleece outsiders, not build the business further.

Add in all the companies that hire pro managers and get woke, go broke, there's a real question of how to hold on to business, and train heirs to uphold the family values.

And, well, how many top bank managers are dual citizens? At some point, a Saudi bank will make a no-interest offering in America, for buying houses. The Chinese diaspora already has private group financing of buying houses in America and Canada. Right now, commercial banking is looking like a Jewish heist on Gentile producers.

Blogger idprism February 04, 2020 3:51 PM  

I am trying to wrap my head around this dichotomy, please pardon my density.

With regard to financial tools like loans which allow a person or family to better their station in life without up-front inter-generational success, "we are all dead in the long run".

With regard to nation, nature, and culture, which have no personal benefit in a lifetime, "plant seeds for your grandchildren".

I know that I'm missing something. I'm not arguing against debt jubilee, and I know that money is caesar's. Is the objection to "responsible debt" that those who are capable of using debt to boostrap are saying that the incapable should be unforgiven slaves because they choose poorly?

side-ward topic slide: would forcing the loan issuer to hold the debt and go bankrupt if they prey upon the incapable help this situation in the long run?

Blogger weka February 04, 2020 3:58 PM  

Options.

1. The law of Sabbaths and jubilee. Let debt accumulate for generations.

2. Make university selective. Give the 10% at most of students who can use tertiary education student grants.

3. Limit mortgage payments to a third of the main salary.

If you do any of the above, limit immigration. The (((outsider))) will scream as his banks fail, but let them.

Those who have capailized their house value will lose big. This is a good thing, as houses cost overmuch at this time.

Usury is a sin, and much of the so called wealth of the globohomo is built on this.

It will happen, anyway, eventually. Sooner would be better.

Blogger HoosierHillbilly February 04, 2020 4:01 PM  

@65 "perfectly fine and reasonable" and "traditional" 30 year mortgages.

Don't buy the spin. 30 year mortgages weren't a thing over here until the 1930's and didnt grab a hold until the 50s. Debt slavery for 30 years is a far cry from traditional.

Blogger dc.sunsets February 04, 2020 4:06 PM  

And Ominous, if you read anything I wrote above as

"hateful disregard for current debt slaves and for the social evils debt slavery causes"

then your literacy is in question.

Go back and read @54 if you have doubt. But the "hate boomers" narrative is just one brick in a vast wall of mutual antagonism destined to follow on this long, long, long period of "We Are The World" togetherness. I see it as a cycle. Sticks and stones and all that.

I don't have the answer...or any answer. I don't propose grand schemes for "making the world better." I'll leave that to those whose words and actions verify an ancient adage about who is confident and who is cautious.

Blogger Silly but True February 04, 2020 4:07 PM  

The Boomer cons by the numbers:

Home: In 1940, median home value = $2,938.00. On Dec. 31, 2019 it is $244,054 — an increase of 8,321%. This is four times higher than its inflation-adjusted increase.

College tuition: Since 1987, college tuition has increased nearly 2.5x for private nonprofit four-year institution and 3x for public four-year institution.

No one would be complaining about the system if median wages entering labor market started at $80,000, but alas, that’s not the case.

The primary driver as everyone knows for these unsustainable increases is greed in gaming taxpayer- subsidized and guaranteed loan programs.

Blogger Nym Coy February 04, 2020 4:11 PM  

So many people seem to think government spending is paid for with taxes. Bless your hearts.

Blogger Nym Coy February 04, 2020 4:14 PM  

Government pays it's bills with debt. No one buys US debt these days except the fed. Forgive the public debt. It's not like the fed's financials matter at all. It issues money how it likes and sets rates how it likes. Am I misunderstanding things?

Blogger Doktor Jeep February 04, 2020 4:17 PM  

"And the real reason for your concern about knocking out debt support for the propped-up house prices reveals itself...."

Back around 2003 I knew some boomers who were pissed that the Clinton gun ban was going to sunset because they had drum magazines and other pre ban items that only went up in value. The end of the ban meant the end of that markup.
"Hello fellow gun owners...."
Goes to show that most people still only value one thing above everything. They deserve nothing.

Blogger Azure Amaranthine February 04, 2020 4:21 PM  

"Azure, if you think that a committee the size of what's in Washington DC is going to produce ANYTHING useful or coherent regarding choosing winners and losers in a debt-cancellation, I have a bridge to sell you."

If you're willing to allow a committee to do whatever they want, that's on you. Boo-hoo it's not an easy one step instant fix. Remove the dealer if you catch him trying to cheat.

War is about logistic strangulation. Choke them down by whatever means most efficient and effective.

"A system of people this size operates like a single organism"

Right up until it doesn't.

Got a better solution? Propose it, else quitcherbitchin'.

Blogger Pratisara February 04, 2020 4:27 PM  

>>Women are working into their 30s until it becomes very difficult to have children at all, let alone several.

This hits the nail on the head as it reveals the true purpose of debt (especially student loans) - to reduce the population. This, along with vaccines, flouride, fertilizers, pushing dog-ownership etc will achieve the mission of Georgia Guidestones.

Then they will cancel the debt.

Blogger Leahn Novash February 04, 2020 4:30 PM  

There is. It's called Distributism. Focus on small, local business, and self-sufficient communities, and break down anything that becomes too big.

Blogger One Deplorable DT February 04, 2020 4:37 PM  

This is not a question of right-wing vs left-wing, and it's very important to remember that banks are not capitalism, corporations are not human beings, and usury is not freedom.

I wish I had learned this back in high school and college instead of the typical (((conservative))) talking points on the economy.

Blogger Unknownsailor February 04, 2020 4:38 PM  

PaulSacramento wrote:
Perhaps, but a slave that is mortgage free with a house valued over 1 million.

If anyone values their house as anything more than a place to sleep at night that keeps heat in and the rain off your face, i.e. a deprecating asset, you might want to rethink that given the crash coming. If you can keep your house after the crash (got friends with rifles? You'll need them,) it will be worth its value as a shelter and nothing else.
The house that is your primary residence is not a retirement asset (rental properties, OTOH, are,) the moment this shit all started to go off the rails is when this became the dominant way to look at them.

Blogger CM February 04, 2020 4:41 PM  

Interesting... I may read that now..

Blogger rumpole5 February 04, 2020 4:56 PM  

What we need is a government sponsored audit to determine the full financial picture of the government assisted university and college system. It should be done by two independent private auditing entities with no note comparisons until each submits a final report. When the reports are in it will be clear where the excess tuition money is going, and said Universities and colleges can be required to make corrections or lose government funding. That would solve the future secondary education debt, and we could then work on solving the existing debt.

I certainly would be open to debt correction. FDR did a form of this when he required the turn in of all gold money and reduced the value to $32 an ounce. Gold holders lost a lot of the value of their holdings.

Trump's limit on tax deduction on state real estate tax was a similar measure. Fat Cats now have to pay the full tax on their mansions without using it to reduce their federal income tax. Likewise, high tax blue states are hit the hardest while the rural red states, that have been back stabbed by establishment sellouts to foreigners, were much less affected. The real estate tax on a home in a rust belt/closed mill town is so low that the owners can still deduct the whole amount from his tax bill. I really love Trump. God bless him!

Blogger Meng Greenleaf February 04, 2020 4:57 PM  

I've read of two proposed solutions:

1) Everyone is credited with a certain amount and this amount must be used to first pay off debt. If you're debt free then you get to have some money. AU did something like this in 2008. People seemed to use it to pay off debt. Thought the government wanted people to use it to buy stuff made in China instead. In the end property sales to Chinese et.al. seem to be the means the AU government settled upon to fix the economy.\
* Not everyone was credited.

2) What if the banks were allowed to go bankrupt? Iceland seemingly did this. Small Chinese banks, as I understand, are always going bellyup.

3) Japan appears to be doing fine - what are they doing? There is some aging of infrastructure, but it's still mostly useable as far as I can tell. The standard of living seems to be going up incrementally each year. Yes, the population is falling back towards post-war levels. Okay. It had to stop growing at some point.

4) What does debt cancellation look like? Suppose someone (corrupt) went out and took a $50 mil morgqage on a massive chunk of land. The next year, debt cancellation comes along - is their debt cancelled?

Lastly, is this the Boomers fault? It feels like it.

Blogger Mauldication Bear February 04, 2020 5:10 PM  

Close to paying what will be over a quarter million in student loans. I still pray it is forgiven for those that were sold the lie and unable to climb out of the hole. I see the despair in people my age, it's truly evil.

Blogger rumpole5 February 04, 2020 5:14 PM  

Re Boomers: "The massive inflation in homes, cars, all major assets had barely gotten off the ground when they were young." A starter house cost around $30,000 when I started work as a prosecutor in 1979. We were paid around $15,000 a year. The interest rate on a loan was over 10 per cent. The cars were real junk compared to what you can buy now. A used car now is very much superior to a new car in '79 in maintenance cost, gas milage cost and durability. It is all or somewhat of a wash.

Where youngsters have a legitimate complaint is student loans. Something needs to be done now to reduce cost and relieve existing debt. Many Boomers would not mind a tax solution because we are already shelling out a significant amount to retire a child's student debt.

Blogger Silly but True February 04, 2020 5:16 PM  

@Hoosier:

True enough. That Overton Window had long moved for me. But you’re correct. Paying cash on pay-as-you-go basis to originate one’s starter home reasonably sized for one’s short- to medium-term needs that is built into one’s family home that is built into one’s extended family home certainly remains viable.

Blogger the other boomer February 04, 2020 5:36 PM  

As little as I like Islam, they do take seriously God's disapproval of usury. Islamic finance works by equity rather than debt; if an islamic bank finances a factory,instead of being promised a certain amount of interest etc. they would own some share of the factory. For people who want a more predictable return, as you might if preparing for retirement, a preferred issue that pays a fixed dividend would seem not to be usury.
Perhaps the best form of retirement investment would be in one's children or other relatives; help them get started in some sort of business in return for income when they prosper.
Belloc sees usury as collecting interest on a loan needed for consumption, as opposed to a loan for things that facilitate production.
These are ways you can have a funtioning economy without usury

Blogger aw February 04, 2020 5:48 PM  

How would you practically implement cancellation? educational first? property first? all at once?

Blogger CM February 04, 2020 6:11 PM  

When a government guarantees a loan that it unlikely to be paid back, what is actually going on is that it is off the books spending. The spending turns up in the present, the loan a covert form of spending that 'looks' like a private borrowing. If we forgive student debt without fixing the situation that creates it, one outcome will be a government that is even more fiscally irresponsible than it is already.

If we want a system that functions on short term, small loans and you think forgiving all the debt all at once in an economy that is reliant on it would implode, aren't there other solutions than just nixing the whole Jubilee idea?

Your gonna eat it now or later, so why not try a corrective action now than it truly imploding later?

If it's TRUE, all forgiveness would break our economy, than announce jubilee in 7 years for all new loans and forgive the top 10% of outstanding loans. Repeat every jubilee year, removing the next set of loans. It would take 70 years to be totally debt free, but hey! We have now have a jubilee system.

Of course, this would require a constitutional ammendment to actually enact, which would require a huge grassroots campaign and population commitment to a cycle or two of single-issue voting. I don't think that would happen.

However, if there is a collapse and we split and start from scratch, then the whole argument is moot anyway because all the debt has been cancelled by chaos and collapse. When that happens, I want to pledge allegiance to the nation state that enacts jubilee.

Blogger map February 04, 2020 6:39 PM  

I support the idea of a debt jubilee...especially for student loans and especially for making counter-parties whole by seizing university assets the way Henry VIII seized church assets.

But Hudson's argument makes no sense. Take the following:

"Michael Hudson: That’s right. The German Economic Miracle was the Allied debt reforms of 1947/48. They essentially wiped out all debts except for what employers owed their employees – you know, the workers’ wages and minimum working balances at the banks. It was easy for the Allies to cancel the debts owed to German creditors. because the creditors were mainly Nazis. The whole idea was to wipe them out. They didn’t the want to leave the former Nazis with financial power to take over the economy again. They wanted a Clean Slate."

Huh? Germany was bombed to rubble. The entire society was shaken down to the rafters. Yet, Nazi banking was somehow intact? All those records were being studiously maintained by an army of dedicated clerks during bombing campaigns and the Soviet invasion? This makes sense? No, it doesn't. Banking collapsed and the records that tied creditors and debtors were gone.

There was already a clean slate by 1945.

If Hudson's argument makes no sense then that is because he is wrong. What caused this Wirtschaftswunder—this economic miracle? Well, first of all, it was not a miracle! Chancellor [Conrad] Adenauer and his economics minister Ludwig Erhard both said that Marshall Plan aid had little to do with it. They didn't try socialism, and it wasn't some government industrial policy. It certainly wasn't a World Bank or IMF-imposed austerity program.

Erhard established a stable currency, backed by gold, and maintained its integrity as a storehouse of value and a unit of account. He allowed the markets to work freely in setting prices and wages, and in allocating resources by eliminating, in one bold stroke, all rationing and price controls, against the wishes of the allied powers, who wanted to maintain wage and price controls. He dramatically reduced the steeply graduated tax rates on working, saving, investing and producing. He applied orderly principles of law to private property, patents and contracts. And, he began to weave a safety net, not a tax-and-transfer hammock, to take care of those who, for one reason or another, couldn't take care of themselves.

This was the basis of the German Economic Miracle. It had nothing to do with a debt jubilee, since there were no debts to discharge. Meanwhile, the British were still languishing under sugar rationing as late as 1955.

I don't understand why Hudson does not know this.

Blogger Scuzzaman February 04, 2020 6:48 PM  

"It's called Distributism. Focus on small, local business, and self-sufficient communities, and break down anything that becomes too big."

On that note, one of the founders had this to say:

"A little rebellion now and then is a good thing, and as necessary in the political world as storms in the physical."

The concentration of political power is very much like the concentration of physical energy that precedes a storm. Think of the storm as the dispersal of energy, because that's what it is.

We can either have small accumulations, and when we notice them, small storms as we enforce their dispersal (even the most benign redistributions will disrupt some lives), or we can leave power to concentrate to enormous levels, ensuring we will endure an enormous storm.

As of today the concentrated power of the shadows behind the throne of federal US might has grown to global proportions.

The Storm we face is going to be a rock and roll extravaganza.

Hoo-ha!

Blogger map February 04, 2020 7:08 PM  

Shannon wrote:I’ve been watching a tv series called Poldark. It’s set in 1700’s in England in an era just like today. The Warleggin’s are the bankers owning all the debt and scooping up all the land and assets of the English. They are kept in line somewhat by the threat of villagers coming after them w torches and pitchforks. They feared the mob

What's interesting about the Warleggans is that they are newly rich. George's grandfather was a blacksmith by profession who, somehow, got into moneylending. One of George's favorite pass times is foreclosing on a nobleman's estate. Basically, George hated both the aristocracy he wanted to be a part of and the peasants. I wonder who he represents?

The show is also unrealistic. In England, property rights do not confer mineral rates. in fact, the United States is the only country where property rights automatically confer mineral rights. In other nations, mineral rights are owned entirely by the government. Poldark's mining operation would not be a viable concern for him because he would not own the ore.

Blogger Scuzzaman February 04, 2020 7:09 PM  

Because you’re wrong, map.

The vast majority of records and associated balances and obligations were intact.

Why don’t you know this?

Blogger Up from the pond February 04, 2020 7:22 PM  

It won't work unless, as Hudson states, it is a debt cancellation on par with the Allies' cancellation of Nazi debts. Will a political party come to power in America that approximates a foreign conqueror, i.e., a party that has no vested interest in America's debt economy? We can hope so and work to that end to the extent of our ability.

I wonder if a sliding scale of debt forgiveness would work or just jinx the Jubilee. Example: debtors who serviced their debt for x years have 90% of the remaining debt forgiven; debtors who serviced it x minus y years, 50%; etc. down to a 10% haircut for the most recently active lenders. Would that "soften the blow" or instead be appeasement of the "personal responsibility" tards' envy and thus ruinous? I tend to think these tards should be excluded from all policy decisions regarding private debt. They're tards because they're vested or believe they are.

Blogger map February 04, 2020 7:39 PM  

Primus Pilus wrote:The modern student loan scams didn't exist when Boomers were in school. The massive inflation in homes, cars, all major assets had barely gotten off the ground when they were young.

These locusts never had to deal with the crushing debt the generations after them have had to deal with, they all thrived off the financialization they saddled their children and grandchildren with, and now they cry "Fairness! Responsibility!" to try to obfuscate their crimes against their own descendants.


In 1968, tuition at the University of Illinois was roughly $350 a year. That was for an unlimited number of classes and it included health insurance. You could work a full time job in the summer and make enough money to pay for a year of college with unlimited classes.

What is interesting is that many of our most exorbitant costs are actually following the gold price. In 1968, gold was $35 an ounce so education at U of I was ten gold coins. Right now, Illinois costs 11 gold coins.

Education and Healthcare is tracking the gold price very closely. One of the commenters here mentioned that a house cost 21K in 1971 compared to 273K today. in terms of the gold price, it cost you 600 gold coins to buy a house in 1971. Today, that house will cost you 175 gold coins. This means that real estate is a huge bargain today, depending on interest costs, which are now super-prime (below 5%.)

Blogger map February 04, 2020 7:47 PM  

Scuzzaman wrote:Because you’re wrong, map.

The vast majority of records and associated balances and obligations were intact.

Why don’t you know this?


Sure. Magic paperwork surviving shrapnel and phosphorus. And the first thing the Germans did when things settled down was to start enforcing these paper obligations against income that was not there, against collateral that no longer existed and against debtors that were probably dead.

This sounds reasonable to you.

Blogger John Regan February 04, 2020 7:54 PM  

No debt to finance a personal expense is "responsible". A man must earn his living, not borrow it.

There's a lot of irresponsibility to go around.

Blogger John Rockwell February 04, 2020 8:22 PM  

@Ominous Cowherd

In fact the US was at its height not when fractional reserve banking is constrained but non-existent.

Full reserve banking is what helped to ensure the prosperity of America.

Blogger nswhorse February 04, 2020 8:55 PM  

@PaulSacramento your anaylysis is incomplete. Yes, the initial outcome will be a crash in housing and new car markets, but that won't be the end. All the houses and land will still exist, and people will still want to sell what they own from time to time. Without the flood of new credit, the amount of money and pseudo-money bidding on the stock of available land and housing. This will cause prices to plummet. Speculative borrowers will take a bath, as will those who bought the lie that property is a permanently increasing goldmine. The banks will also take a bath. The upshot will be lower prices and tighter lending, which favours genuine buyers who want a home over the long term or landlords who want to make money from rent rather than from flipping. In the long run, regular people win, as home ownership becomes a realisable dream again, and less people being forced to rent lowers rent for those who still need to or choose to.

As to what would happen with car makers, it is less certain, other than a realignment frpm those who make shit cars and have shit business models dependent on endless debt exiting the market, and those who make good cars and are capable of running businesses with a long term view and being profitable on sales by providing value will inherit the market. I suspect we'd also see better and more durable cars, designed to last decades rather than be on-sold in 5 years.

Blogger Ominous Cowherd February 04, 2020 9:17 PM  


Huh? Germany was bombed to rubble. The entire society was shaken down to the rafters. Yet, Nazi banking was somehow intact? All those records were being studiously maintained by an army of dedicated clerks during bombing campaigns and the Soviet invasion? This makes sense?

Yes, it does make sense. It's hard to imagine Germans doing any less.

Blogger VFM #7634 February 04, 2020 9:24 PM  

As of today the concentrated power of the shadows behind the throne of federal US might has grown to global proportions.

@145 Scuzzaman
You're making the Trump administration's junking of reams of regulations and slow removal of Swamp creatures sound like the rebellion is already happening.

Blogger Lazarus February 04, 2020 9:25 PM  

The biblical jubilee worked because it was fore-ordained and a deadline was instituted so people could plan for it.

Plus, God made sure the increase of the 49th year was enough to see people thru for a couple of years.

Steve Keen's People's QE (use search engine here) would work in the interim until such a system was institutionalized.

Blogger Emmanuel February 04, 2020 9:26 PM  

@10

You're concern trolling is hilarious. You think the democrats are gonna get another president in the white-house in our lifetime. XD

Blogger Emmanuel February 04, 2020 9:49 PM  

@70
"Allow me to clear that up:
Without debt, the current economic model can't exist."

Exactly! That's the plan you idiot! That's literally President Trump's plan! To build up a parallel economic system that operates on a completely different model before the current economic model crashes and to crash on his own terms one the time is right so that the transition between the current model and the one he's setting up are favorable and doesn't completely shatter the country! The current economic model is a dinosaur about to be extinct no matter how you slice it, dude. The only question is, can President Trump build up his parallel economic system in time before the satanists crash it in such a way they can dictate terms to us or even it's the other way around and Trump dictates terms to them. And Trump IS going to be the one dictating terms to them.

https://www.youtube.com/watch?v=6HTXzZX5Wcs

Blogger Yukichi Sensei February 05, 2020 12:42 AM  

I am for debt cancellation if we end usury. That is a deal I will take. I have 0 Debt and I hope this for everyone.

Follow the Bible, folks.

Blogger James Lovebirch February 05, 2020 12:54 AM  

The light Hudson shed on the recent Greek crisis blew my mind.

@128

The way I think about it is that that results in inflation and inflation is a form of taxation. You're right that a significant portion of what the federal government spends is not collected as tax.

Blogger Станислав Бартошевич February 05, 2020 1:43 AM  

He does nothing of the kind. Your objection is both obvious and moronic.

Try to actually refute it then.

Your conclusion is the same as the idiots who think global corporations are preferable to national governments.

How many people who engage in dichotomy of global corporation vs. national governments would be willing to put themselves where their mouth is and accept living standards of North Korea or even Iran?

Moreover, an economy does not depend upon credit.

You don't seem to have read the very Hudson's interview you've posted. "Every economy needs credit to function and grow" (c). Anyway, here he's just stating that 2x2=4. Every form of capitalist enterprise that allowed the industrial revolution and all of the subsequent revolutions to happen, starting from the joint stock company, is based ultimately on credit. You want an example of a modern society where a majority of actual workers and producers of things are not exploited by banksters? Why, that would be much of the third world, certainly including Latin America and Arab countries - it remains the third world because starting up a legal business is borderline impossible unless you're a member of the elite, and it is impossible not only because of direct government regulations, but because whatever property a wannabe businessman may own is not officially registered due to other government regulations, which among other things makes it impossible to use as a collateral for a loan.

No, idiots who have been bought off by bankers publish spurious theories that don't hold up to simple logic, let alone the entire history of banking.

So, use your simple logic and offer some sort of (d) as an alternative to my (a),(b) and (c).

By the way, given that entire history of banking are you arguing for total cancellation of all debt (now that would be a sight to behold, preferably from another planet, given that bank deposits, various bonds, and pension funds also are loans), or selective cancellation of some debts, something that historically was extremely exploitable by insiders?

Blogger Jose Miguel February 05, 2020 3:15 AM  

Even if I spent a million dollars on a house like @PaulSacramento and no mortgage, I'd see the inevitable drop in equity from the debt jubilee as a massive bonus since my actual cashflow would improve significantly as my property taxes dropped. Where I'm at I still rent even if I could buy because property tax is killer. Better to rent until I can buy some cheap land and plant a yurt or mobile home on it and have an adventure with my family getting the homestead up and running.

People keep telling me to buy at least in the suburbs to lock in my monthly payment for housing, yet I somehow keep doing better financially than my friends and family who do so.

Blogger JE Hamilton February 05, 2020 4:24 AM  

Debt cancellation is the only way to squeeze the Mammonites and the usury class.

Blogger Kill Bill February 05, 2020 4:47 AM  

3) Japan appears to be doing fine - what are they doing? There is some aging of infrastructure, but it's still mostly useable as far as I can tell. The standard of living seems to be going up incrementally each year. Yes, the population is falling back towards post-war levels. Okay. It had to stop growing at some point.

Saving as Mises suggested? Asians are known to be misers. Now if they saved in PMs like the central banks they would do even better.

"Conservatism has always been the heat sink to the Leftist political machine.

The typical red state, pick up driving tard is dumbed down beyond hope thanks to CUCKservatism/Churchianity and those red state taxes going to public skrools in red tard states aren't going to raise their IQ. If they scrounge enough meth together (Instead of taking opioids) so they can work harder for their greedy CUCKservative Massa they won't notice the immigrants/invaders in blue areas enjoying their life at a relaxed pace and of course making more money. Now mix in Boomers and the idiocy is complete.

Blogger bodenlose Schweinerei February 05, 2020 5:39 AM  

Hudson maybe the blind squirrel knockin' his noggin on the nut:

"For instance, in the United States, President Clinton finally ran a budget surplus in the last year of his rule."

He also says " every economy needs credit to function and grow"

1. "his rule"?

2. Even assuming this "surplus" was not simply the result of non-GAAP accounting, was it the result of any actual policy, or simply the result of the largest population cohort in history being in their prime earning years, along with a bloated asset bubble that ate the giant schwein shortly after this "surplus" showed up on the accounts?

He also claims "every economy needs credit to function and grow" which is derided as nonsense in this very thread, "total nonsense" in fact.

"you’re dealing with a criminalized banking class that I think we should treat in the same way that the Allies treated the Nazi"

Recruit them into our space program, weapons development and intelligence agencies?

Blogger John Regan February 05, 2020 7:49 AM  

Well, having thought this through as best I could a long time ago, I came to the conclusion that a jubilee would have to be done by constitutional amendment (since it would be politically impossible for elected officials), that nothing could be excepted from cancellation besides cash and bank deposits, and that it would be a good time to restore an actual gold standard (as opposed to the fake ones we had previously) to stabilize things.

One interesting note is that if you follow that link and look at the sole comment it should sound familiar. There's a steep learning curve in all this. It would be worth doing. One other benefit would be to help people recover their sense of self-government.

Blogger Kari Hall February 05, 2020 8:26 AM  

I haven't read all the comments, but what about the biblical concept of Jubilee from Leviticus 25? I never understood if we were a Christian nation why we didn't abide in Jubilee.

Blogger John Regan February 05, 2020 9:01 AM  

Then, just last year, deeming the "but I paid all my debts, not fair!" objections politically insurmountable, I came up with a scaled back proposal that would do a lot of good and was much simpler

Be sure to read the comments to that linked post, if you're interested in this kind of thing.

Blogger dc.sunsets February 05, 2020 9:07 AM  

I never tire of laughing cynically at those whose proposals reveal a stunning lack of understanding. Only small children think you can take the flour out of gravy once it is made.

I see endless rants here at boomers, at teachers, at housing inflation and the costs of higher ed (missing are rants at the Medical Industrial Complex, which is a far larger problem, costing each of you $2,500 or more each year, every year, per PERSON.) I assume these are largely leveled by people too clueless to avoid the Debt Trap. My sons all got STEM degrees without debt. If your daddies didn't help you avoid being an idiot, and didn't love you enough to help you avoid starting adulthood in peonage, too bad, so sad for you. If this were video I could show you the microscopic violin I'm playing "My Heart Bleeds For You." This isn't a defense of peonage, it's a restatement of reality.

1. The clock is already ticking on the Debt Time Bomb.
2. It cannot be defused by you, me or anyone else.
3. Proposals to "top down" our way out of this come exclusively from people who apparently cannot see how politics doesn't DO such things.
4. When (WHEN) this Mt. Vesuvi-Debt erupts in earnest, it will set off the largest contraction in nominal wealth ever.
5. Asset prices will fall.
6. Entire industries will contract by 50% or more.
7. Unemployment will hit unprecedented levels.
8. Political unrest will explode.
9. The central government will prove too short on popular consent to do much of anything useful.
10. Our microscopically fine division-of-labor economy will backtrack.
11. This backtrack will render tens of millions of people without the ability to earn, even in relative terms, a fraction of what they earn now. Learn to code? Try learn to stack boxes....
12. This is ALL an effect of the human capacity for herding behavior. If you don't like it, good luck. It's part of our DNA. Our individual and group behavior is GENETICALLY CODED. It's got NOTHING to do with nurture. If you believe otherwise, try raising a German Shepherd puppy in a litter of Labrador Retrievers and see how well it learns to pick up pheasants.

No, the future is not an endless series of new iPhone versions. Your proposals for "fixing" what's wrong are 100% illustrations of "be careful what you wish for, you just might get it."

It's not a failure of courage to recognize this. I simply note that if you think you're setting sail for the adventure of unknown seas, pay a little attention to the wind and the sky. Successful navigators don't begin the voyage in abject ignorance.

Blogger Azure Amaranthine February 05, 2020 9:33 AM  

"in terms of the gold price, it cost you 600 gold coins to buy a house in 1971. Today, that house will cost you 175 gold coins. This means that real estate is a huge bargain today, depending on interest costs, which are now super-prime (below 5%.)"

Thanks for indirectly pointing out why gold is not necessarily relevant. Average income per household in 1968: ~6k.

"In 1968, gold was $35 an ounce"

So, ~170 ounces of gold a year.

Today: Fun facts, mostly stated in income per household. Why? Because most of the women are having to work now. And it's still about 90k. Price of gold? ~1,500 per ounce. So, for more often TWO people working today, that's ~60 ounces of gold a year.

Gold price? Who gives a flying f*** if gold costs three times as much? No one except gold miners or people who could be mistaken for them by their ability to produce gold from vaults.

"In fact the US was at its height not when fractional reserve banking is constrained but non-existent.

Full reserve banking is what helped to ensure the prosperity of America."


Ding ding ding. The problem with fractional is that it's the beginning of the slippery slope of fiscal unreality. Banks need to retain a fraction of the value of the money they conjure to loan out? Well, how high a fraction? 7/10? How about 3/20 so more profit can be made, everyone benefits from more money! Oops, now it's 3/100, and the notes are already debased.

"All those records were being studiously maintained by an army of dedicated clerks during bombing campaigns and the Soviet invasion? This makes sense?"

Ahh, I see you've made the first leap to understanding the idiosyncrasies of Germans. They'd probably rather go extinct than let the record slip or a single letter of the law be mutilated.

"The biblical jubilee worked because it was fore-ordained and a deadline was instituted so people could plan for it."

Funny thing about that, is that it wasn't fore-ordained right up until it was instituted. Bargain bin tier bad reasoning. The only people who would get caught out are the ones being irresponsible lenders or who are invested in irresponsible lending, and both have it coming.

"The way I think about it is that that results in inflation and inflation is a form of taxation."

Easier to think about it as devaluation of existing currency. Else, the important thing to remember if you think about it as taxation, is that everyone who holds a dollar is being taxed a percentage of their dollar holdings.

"How many people who engage in dichotomy of global corporation vs. national governments would be willing to put themselves where their mouth is and accept living standards of North Korea or even Iran?

Dishonesty. Begging the question. Going with national governments to victory wouldn't cause either of those.

"Moreover, an economy does not depend upon credit.

You don't seem to have read the very Hudson's interview you've posted. "Every economy needs credit to function and grow" (c)."


Funny thing, for most people, if they talk long enough they eventually get some things wrong. You on the other hand don't have to go very long at all.

"By the way, given that entire history of banking are you arguing for total cancellation of all debt (now that would be a sight to behold"

Oh noes bad things will happen I'm so concerned. Man up, simperling.

Blogger Azure Amaranthine February 05, 2020 9:37 AM  

"Recruit them into our space program, weapons development and intelligence agencies?"

Only the ones who still have any value when stripped of their stolen assets.

Actually, no, it's better not to adulterate ourselves by using. Exile or compost.

Blogger Avalanche February 05, 2020 9:58 AM  

@64 "Just don't cancel my replicator rations."

"Solent Green is PEOPLE!!!"

Blogger Avalanche February 05, 2020 10:37 AM  

@71 "Instead of looking at it as a gift for irresponsible people, look at it as the gift of civilization to everyone. Because this system is going to fail if all of these problems are left completely unaddressed."

The gift of civilization to everyone? Including those irresponsible grifters and foreigners and politicians who have LED to the oncoming destruction of OUR civilization?

This is what makes me struggle to understand what Vox is teaching: WHAT will stop the irresponsible and grifters and vote-for-me pols from just doing it / destroying it all again?

When my husband died, I had to pay off $102,000 in credit card debt. I would have LOVED a jubilee! As it was, the courts wiped out the $50k in his name: thank you, Georgia! I paid off the $52k in my name over the next 3 years. I do not resent my husband for that: he wasn't supposed to die (duh); he gave me, a kept wife, a fantastic life even though it was 100% not how *I* would have run our financial life; and a big chunk of it was keeping the MFG company and his one employee afloat through and after the 2002 'crash.'

What gift of civilization do I owe to grifters and cheating illegals and foreigners and paperwork Americans who are just here to parasitize and intend to 'retire back home'? How do we manage a jubilee and ending usury when the country is full of liars and cheats?

This all seems so systemic, and pulling any one thread seems to end up in bloodshed and war. Or should that be: *to start up* the bloodshed and war? Or is this just wistful hope that may provide a blueprint for the future "ethno-state" / nation that we will build after the bloodshed and war?

Not blackpilling; trying to find my way through, from today and the oncoming apocalypse, to how it "ought to" work.

Blogger LiveForever February 05, 2020 10:54 AM  

@169
Your comment is so stupid and so ignorant that one can only assume that you're an atheist boomer.

Blogger Avalanche February 05, 2020 11:42 AM  

@73 #1: That's the exact same argument as "someone's eventually going to do evil thing X so it might as well be me doing it first."

To which the obverse is: "if all these other folks are cheating like mad, I am a CHUMP for continuing to act with integrity."

It's NOT the ones with integrity, the ones who built this civilization: granted, who didn't or couldn't imagine the grifters and corruption we're now mired in, who fell for the small hat manipulations.

It's Magic Financial Dirt, is it?

"A Republic, if you can keep it?"

Blogger Avalanche February 05, 2020 12:01 PM  

@77 " Just because I had worked harder to get out from the thumb of the usurers does not mean that others who did not work as hard should be subjected to more evil because of some messed up egalitarian belief that the pain should be dolled out proportionally. ... While the irresponsibility of others is clearly a bad thing and should be condemned, we should not answer that by throwing them to the wolves who are the root of the problem to begin with."

Are you then suggesting that we should give our OWN leg to the wolves to gnaw on, BECAUSE the irresponsible who let the wolves into the compound are getting attacked by the wolves? Is it evil to let the irresponsible ones receive the payment *they chose* by their bad or evil choices? WE should choose to protect them -- and allow our families and nation -- to suffer "proportionally"?

Spare the rod, spoil the child? Did not Jesus chase the moneylenders from the temple with whips? They CHOSE and He proportionally meted out punishment/discipline. Are you saying: "yes, this destruction is partly the responsibility of these irresponsibles"; so do you say the RESPONSIBLE have evil in their hearts for not being willing to be chased out with whips?"

"Egalitarian beliefs"? If your neighbor's child goes out into a snowstorm without a coat, should you let -- or force -- your child to do the same, in order to 'not throw the frozen child to' the ice, "which is the root of the problem to begin with"?!

"does not mean that others ... should be subjected to more evil"

Why not? Does God, Jesus, the Bible -- anything -- say you should protect those who choose evil from the results of that evil? Nothing in my reading implies that.

Not arguing just to argue -- I really am trying to find an understandable principle in: "just because *I* am so good and responsible with my debts, others who are not responsible should be protected from the natural results of their own actions"? Is that not a proud heart, i.e., goeth before a fall? "Look-at-me, I'm SO magnanimous that I think we shouldn't let (other? lesser?) adults receive the 'benefit' of life-experience-payback for their bad choices?"

Blogger Avalanche February 05, 2020 12:06 PM  

@78 "It is nothing more than envy, masquerading as a plea for justice."

Yeah yeah, whack at the boomers some more.

I run a small business. If someone orders $7k worth of product and then declares bankruptcy; he has just STOLEN $7k from me, my biz, and my family. If he takes my $7k worth of tangible goods, and the GOVERNMENT gives him a jubilee -- it's okay somehow, because the govt stole it from me, not the irresponsible guy who actually 'took' it without paying me for it?

Envy? I've got no envy in this; I've got a righteous anger at the evil of the evil-doer -- and would really like Jesus to show with whips!

Blogger Ominous Cowherd February 05, 2020 12:28 PM  

Kari Hall wrote:I haven't read all the comments, but what about the biblical concept of Jubilee from Leviticus 25? I never understood if we were a Christian nation why we didn't abide in Jubilee.
The Mosaic Covenant is ended, the Mosaic Law has been fulfilled, can no longer be followed, no longer applies.

Christians have a better deal, anyway.

Blogger Ominous Cowherd February 05, 2020 1:01 PM  

Avalanche, ``what about me'' is no way to make policy.

No matter what we do, most debts will not be repaid, because it is not physically possible to repay everything: what is owed exceeds what exists. We have to manage the default.

The purpose of the jubilee which is being proposed is to harm enemies of civilization - banksters and academics and miscellaneous globalists - while minimizing the damage they have already done by entrapping Americans in debt slavery.

Yes, it would be a mess. Not doing it is going to be a mess, too, so the mere fact that it will cause upheaval is no argument against it. Upheaval is coming; we want to take the path that leads to the most victory with the least damage to our side. That path might involve something like a jubilee.

Blogger Azure Amaranthine February 05, 2020 1:03 PM  

"Successful navigators don't begin the voyage in abject ignorance."

I don't see any solutions from you, only problems. Successful navigators begin the voyage at all.

Social mood mania is your personal bone to megalomanticize about. We've gotten it long ago, your continued harping at the choir isn't helping anyone. It's depressing and useless. Find a way to say something new and useful, find a way for it to not be a solid block of morale neg.

"To which the obverse is: "if all these other folks are cheating like mad, I am a CHUMP for continuing to act with integrity.""

It's the same picture. You're either a chump or the last righteous person standing in that regard. If you think you're #2 you better make sure you're right. If you're #2, you better keep standing.

Blogger Azure Amaranthine February 05, 2020 1:09 PM  

"Are you then suggesting that we should give our OWN leg to the wolves to gnaw on, BECAUSE the irresponsible who let the wolves into the compound are getting attacked by the wolves?"

The wolves got into the compound while you were on watch, or at the least your watch has begun decades since their entry. The wolves are still in the compound. If you didn't personally let them in, you apparently didn't care enough to get them out.

If you don't want to be lumped in with boomers, don't stand up when potshots start flying at them. If the shoe doesn't fit, get it off of your foot.

" If someone orders $7k worth of product and then declares bankruptcy; he has just STOLEN $7k from me"

IT'S NOT FROM YOU, SPAMALANCHE.

Blogger Azure Amaranthine February 05, 2020 1:14 PM  

"The purpose of the jubilee which is being proposed is to harm enemies of civilization"

The point is to liberate our weaker brethren. Shafting their abusers is just a nifty extra feature.

Blogger Johnny February 05, 2020 1:21 PM  

>>In fact the US was at its height not when fractional reserve banking is constrained but non-existent.

One of the ironies of colonial history is that these remote and small British colonies in North America were actually the original source of paper money.

Early on there were no banks, but the colonial governments took to the direct spending of paper IOU's, paper money. A few did it honorably for a while, but eventually they all got around to over issuing. People of the day were for or against it. It stimulated commerce, a good thing. If overdone as it commonly was, it produced a measure of inflation eventually followed by instability. With nobody keeping detailed records at the time, it isn't possible to produce good quality data as to events.

At first it was thought that the Federal gov exceeded its powers with starting a bank, but most or all the states had state banks and they are still with us. That is, there never was a time when there wasn't fractional reserve banking in the United States.

The actual issue was whether there should be a national bank. Alexander Hamilton talked Washington into starting a national bank with the implied powers doctrine. Eventually Andrew Jackson killed the thing. That left us with no national bank until the pseudo national bank, the Federal Reserve, got started.

Blogger Dwayne Thundergrit February 05, 2020 2:49 PM  

How about an interest Jubilee?

interest paid to date on any loan must be credited to the unpaid balance and in lieu of interest on the balance a one time origination fee of 5% of the remaining principal balance may be charged with payments going forward recalculated to reflect the principal plus that one time charge of 5%. No other fees or interest can be added to that balance going forward to the full repayment of the debt.

Then make compound interest loans illegal.

Does that slow the collapse or soften the blow?

Blogger Avalanche February 05, 2020 4:06 PM  

@179 "The purpose of the jubilee which is being proposed is to harm enemies of civilization - banksters and academics and miscellaneous globalists - while minimizing the damage they have already done by entrapping Americans in debt slavery."

Thanks for your answer, Cowherd. Is there a way to 'focus' that harm on those enemies, while still avoiding too much collateral damage? It's not just "what about me?" It's also: what about my suppliers and my distributors both small- and medium-sized businesses, who may have a building mortgage or a mortgage on a $90k CAD/CAM mill and/or salaries to pay.

Or is it just full-on destruction and heaven-help the hindmost? I often point out to idiot lefties that there is not enough money on the planet to pay for their 'medicare for all' even just for everyone already here. And their plans must result in forcing doctors and medical staff INTO slavery. Currently, a medicare-accepting doc gets a whopping $9 (that's NINE, not ninety!) for a elderly pt. visit, so who will go to med school?

I would be happy (-ish) to see the colleges all have to pay out their Swiss bank accounts to 'make whole' all the hoodwinked students drowning in debt. Banksters jailed or swinging. Globalists exiled or jailed or swinging. But many of my suppliers are little shops: one, two, three employees, and I worry about them surviving too.

Blogger Pathfinderlight February 05, 2020 6:27 PM  

The final straw that showed everyone that the government was in the grip of the banking kingpins was the bailout that happened following the 2008 financial collapse. 90% of America's banks should have failed. They deserved to because they got themselves drunk off evil lending designed to impoverish people. When the impoverished people couldn't pay, they argued the American people should collectively pay.

This was the planned fleecing of the American people, pure and simple. It was a betrayal that showed everyone these people are a foreign invading culture hellbent on eradicating us.

Blogger JamesB.BKK February 05, 2020 6:37 PM  

The US government didn't spend money into the economy during the time of that supposed surplus? Expenditures increased. Total debt of the government increased. That supposed surplus was a result of a heist and govt accounts sleight of hand.

The govt money - obtained at gunpoint - was spent on a lot of stupid and evil stuff for sure, and multi generational welfare seems to be going horribly, predictably. Aimless shiftless lives, ruined.

That guy sort of whiffs on it being official government policy to damn and discourage savings and promote asset price levitation using ever increasing debt and for lenders of all stripes to find more and more borrowers of marginal, little, or no creditworthiness. Reduce even the rate of growth of debt at this point and you will see asset prices finding lower levels quickly. It will be described as a collapse. That is the discovery of what's real, sought to be prevented at any cost by our central banker overlords.

Blogger Ominous Cowherd February 05, 2020 7:08 PM  

Avalanche wrote:Or is it just full-on destruction and heaven-help the hindmost?
That is what we will get by default, if we do nothing.
Avalanche wrote:Is there a way to 'focus' that harm on those enemies, while still avoiding too much collateral damage?
Probably. Acknowledging that predatory lending is wrong, forcing predatory institutions like banks and universities to disgorge their profits, ending fractional reserve banking ... it's a long list, and going to be unpopular with the many races of grabbler. It will take political will that we haven't seen in the White House - yet. Maybe in 2021, or maybe with President Don Jr in 2025.

Or we could wait, do nothing, and devil take the hindmost.

Blogger Primus Pilus February 05, 2020 7:16 PM  

dc.sunsets wrote:I see endless rants here at boomers, at teachers, at housing inflation and the costs of higher ed (missing are rants at the Medical Industrial Complex, which is a far larger problem, costing each of you $2,500 or more each year, every year, per PERSON.) I assume these are largely leveled by people too clueless to avoid the Debt Trap. My sons all got STEM degrees without debt. If your daddies didn't help you avoid being an idiot, and didn't love you enough to help you avoid starting adulthood in peonage, too bad, so sad for you. If this were video I could show you the microscopic violin I'm playing "My Heart Bleeds For You." This isn't a defense of peonage, it's a restatement of reality.

You and your BoomerCon ilk need to stop trying to defend your generation. It's not a good look, and it's not having the effect you think it is.

Blogger map February 05, 2020 7:34 PM  

Azure Amaranthine wrote:So, ~170 ounces of gold a year.

Today: Fun facts, mostly stated in income per household. Why? Because most of the women are having to work now. And it's still about 90k. Price of gold? ~1,500 per ounce. So, for more often TWO people working today, that's ~60 ounces of gold a year.

Gold price? Who gives a flying f*** if gold costs three times as much? No one except gold miners or people who could be mistaken for them by their ability to produce gold from vaults.


So what exactly is you point?

First, I am showing you something you already understand: we have become poorer since 1968. Before, we made the equivalent of 170 gold coins. Now, we make 60 gold coins.

However, despite the greater poverty, housing is still remarkably affordable. A house that costs 600 gold coins gets paid off in approximately 3 years with an income of 170 gold coins. A house today that costs 170 gold coins gets paid off in roughly 3 years when the income is 60 gold coins.

This argument only applies to housing. Education and healthcare simply tracked the gold price, but incomes did not so we are paying 1960s prices on 2013 income, where we are earning a third of the gold coins we used to earn.

Why does the gold price matter? Because gold is a constant. The dollar-price that you see is a measure of the value of the underlying currency, not the value of gold. Gold rising from $35 an oz to $1,550/oz is a measure of how much inflation and loss of purchasing power we have seen in the US dollar.

That's why it matters. That is why we had gold standards like Bretton Woods, so that inflationary/deflationary errors are avoided.

The role the Federal Reserve played up until 1973 was to maintain the gold standard. The mess we are in now has nothing to do with the private banks. It has to do with the Fed not having anything to do since we got off the gold standard. They are flailing around with nonsense Keynesian theories that are causing economic crashes, like the one in 2007-2008.

Blogger map February 05, 2020 7:55 PM  

Pathfinderlight wrote:The final straw that showed everyone that the government was in the grip of the banking kingpins was the bailout that happened following the 2008 financial collapse. 90% of America's banks should have failed. They deserved to because they got themselves drunk off evil lending designed to impoverish people. When the impoverished people couldn't pay, they argued the American people should collectively pay.

This was the planned fleecing of the American people, pure and simple. It was a betrayal that showed everyone these people are a foreign invading culture hellbent on eradicating us.


No, this is entirely wrong. The Federal Reserve caused the economic collapse in 2007-2008, not the banks. The bank bailout was necessary because the Fed was attempting to fix the problem they caused in the first place.

Blogger Akulkis February 05, 2020 10:50 PM  

@35

" If every economy needs credit to function and grow, then your options are as follows:"

So, according to you, no economies existed before the invention of fractional reserve banking during the middle ages.

Amazing.

You should get a Nobel Prize in History for this earth-shattering discovery.

Blogger Akulkis February 05, 2020 10:54 PM  

@40

"What is most interesting about that piece is the contrast of private and public debt, as if they are alternatives. Public and private debt are independent."

One reason the banker-left champions Keynesian theories, and welfare programs is that both (deliberately) muddy the waters dividing private sector debt and public sector debt.

Blogger Azure Amaranthine February 05, 2020 10:58 PM  

"Because gold is a constant."

Wrong. Usually more stable, sure, constant, no.

Blogger Stocky Anglo February 05, 2020 11:03 PM  

Well as usual I started with my typical pre programmed skepticism, "Vox can't be right".... Yep just like everything else I have learned in the last year, the world is a very different place than I thought it was. What I thought I understood turned out to be cherry picked abstracts that align with the official narrative. But hey at least the taught me the full postmodern theories of Derrida and Foucault.

Blogger Akulkis February 05, 2020 11:51 PM  

@44

"House sales would drop tremendously, new home developments would drop, construction would suffer a missive hit, huge unemployment that would affect all other sectors.
Without credit, there is NO economy."

Bullshit.

The market for overpriced (as in $/square foot), oversized (as in how many square feet) would drop.

The overabundance of developers would cease to be. These are part of the coalition driving the Open Borders treason -- more illegals = more housing needed, along with the "[insert religious denomination here] Family Services" organizations and their dollar-skimming rackets in which they funnel taxpayer dollars to illegals (so that no illegals ever appear on GOVERNMENT welfare documents). George Bush the younger deserves to Burn in Hell while still alive for this "Faith-based Initiative" law which was designed to be nothing more than a money-laudering scheme for giving illegals so much assistance for rent, utility bills, and groceries that they somehow have excess money to send home while working at below-market wages during a wage depression.

Blogger Akulkis February 05, 2020 11:59 PM  

@46

"Even if both sides of the equation was cancelled, we would still have the problem of the education institutions. I, for one, would never support higher education becoming public. Without this limitation, in 20 years we will once again be talking about debt forgiveness. The universities will never just fire all of the people that need to be fired."

Purdue is moving to just this sort of system. One alternative for financial aid is tuition deferment. The student signs an agreement to pay X% of earnings for N years after leaving Purdue. High value degrees have low numbers for X and N. Low value degrees such as the complain-mongering "[Intersectionality Pokemon] Studies" have high values for both X and N.

Within 10 years, Purdue will be funding itself on limited finite-term contracts with its alumni. The higher earnings Purdue's alumni make, the better Purdue's finances will be.

Purdue President Mitch Daniels' aim is to divorce the university from the corrupt student loan business entirely. At the same time, the President's funding structure will starve these departments which award degrees which literally make those to whom they are awarded less employable and less productive.

Blogger Akulkis February 06, 2020 12:24 AM  

@53

"Capitalism requires borrowed money and no depositors will be forthcoming,"

Wrong. There are other ways to raise money for your business other than taking a loan from a bank.

1) Bonds. You make payments (either periodically, or lump sum upon maturity) to those who put up the money directly. If you go bust, they lose their money. As few people have enough time to

2) Stocks. Again, don't give money to a "business man" and his friends if you have no idea what his reliability to is to start and run a business and no understanding of the products or services they intend to market.

Prohibit banks from engaging in lending, and return them to their original purpose -- a common, guarded site for the storage of easily liquidated, fungible, or easily trafficked valuable items (from jewels to gold, artifacts, and stock and bond certificates). Absolutely PROHIBIT banks from making loans based on deposits, because the first thing they will do is the same scheme they started 1500 years ago... issuing out more IOU's than the amount of gold on deposit. Restrict every banks to charging storage fees on whatever is deposited with the bank, and possibly clearing checks.

Small communities will have small banks. Contents are worth a limited amount of effort put into breaking into the bank or otherwise robbing it.

Larger communities will have more depositors. Being a larger jackpot for thieves, will require more security... but this level of security is paid for by more depositors.

Therefore, storage fees in both large and small communities should be roughly equal.

By doing this, the housing spiral stops immediately. Homes become affordable again, even for those working minimum wage, as there is no artificially bid-up pricing due to a flood of fiat currency.

Blogger Unknown February 06, 2020 12:24 AM  

That is exactly correct. I have been having my own discussion about debt cancellation on another platform. Most of those disagreeing with me, are struggling to see the link between individual responsibility and social responsibility.

The propaganda of individualism is strong in our society. I was once under its sway myself.

Blogger Akulkis February 06, 2020 12:29 AM  

@53

"The existential problem with debt cancellation is that those who money is lost will never loan it to a bank or government again."

You have utterly failed to show how this is anything other than an extremely GOOD thing.

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