The Government Should Erase All Debts Right Now
The Government Should Erase All Debts Right Now
This poverty-creating scam by the rich has gone on long enough. Delete the $50 trillion.
America is on a crash course with feudalism.
It’s basic math. In fact, archaeologists have found ancient Babylonian accounting tablets that show how compound interest destroys society: The real economy grows incrementally on a slow-arcing S-curve, whereas interest compounds exponentially forever. Eventually, the interest “owed” to vampirical creditors is greater than the entire output of the real economy, and society collapses due to crushing poverty, civil war, or both.
Imagine a pressure cooker where you never let off steam. Eventually, everything inside the cooker gets crushed, and then the cooker explodes.
It happened to Rome, and it will happen to America.
Math doesn’t care about our feelings, whether we vote for right-wing Republicans or right-wing Democrats, or whether or not we’re woke or a worshipper of rules-free-marketeerism.
Compounding interest paid to parasites will destroy America. Rich creditors don’t spend their profits into the real economy — the entire reason they invested in the first place was that they had extra money they didn’t need — so they just take their profits and bid up the price of assets like your grandma’s condo. This makes life more expensive for working people… so they have to go into more debt to banksters and bondholders.
Sumer and Babylon and ancient Israel figured out how to ensure their civilization didn’t collapse due to working peasants becoming slaves to the creditor class:
They temporarily made the idle rich slightly less rich.
In 2400 BC, the Sumerian king Enmetena declared a debt amnesty.
In 1792 BC, the Babylonian king Hammurabi declared a debt amnesty.
In ancient Israel, they sounded a trumpet on the tenth day of the seventh month and canceled all debts every 50 years.
In 594 BC, Solon founded Athenian democracy by declaring a jubilee in ancient Greece. His express purpose for doing so was to get rid of serfdom and slavery. He canceled all debts, freed all slaves, gave serfs their land back, forbade the use of personal freedom as collateral for future debts, and wisely instituted a maximum property size to prevent unlimited accumulation of land by powerful elites.
It’s time for America to wake up to mathematical reality and do the same.
National Debt
Let’s start with the national debt since it’s the easiest.
American taxpayers “owe” $31.46 trillion and will pay nearly $1 trillion in interest to creditors this year.
That’s like shooting one million millionaires in the head.
Instead of paying for healthcare and college and hydro-powered hyperloops between walkable eco-cities, Americans are forced to labor and hand over $1,000,000,000,000 to passive investors who didn’t create any new useable wealth for society.
But there’s a simple concept that ancient rulers understood: Debts owed to oneself aren’t debts.
Student Debt
I don’t like the term “student loan forgiveness.”
Because getting an education isn’t a sin.
American elites simply decided to monopolize knowledge through the power of accreditation, and then charge access.
The choice is clear: Either get rid of accreditation or give free access to all those who want knowledge so they can better serve others.
Knowledge should be delivered to our children at true cost, and the nation of adults should proportionally foot the bill.
Medical Debt
The US Constitution guarantees all Americans the right to “life, liberty, and the pursuit of happiness.”
This means enslaving people with interest-bearing debt just to stay alive is unconstitutional.
If you’re forced to pay private corporations for healthcare and you can’t afford to do so, you’ve lost the right to life.
If you’re forced to pay interest-bearing debt to corporations for healthcare, you’ve lost your liberty and ability to pursue happiness.
Either we rip up the Constitution, or we uphold the Constitution.
Mortgage Debt
As we’ve discussed before, modern mortgages are blatant financial fraud, and we should obliterate them once and for all.
After the 2008 Great Recession, Iceland wrote off massive amounts of mortgage debt and raised taxes on the rich in order to recover quickly.
Meanwhile, America’s real economy has yet to recover, with tens of millions of families still in worse shape in real terms.
The single greatest thing any government could do for their citizens right now is to make human shelter more important than corporate profit.
Consumer Debt
As the economist Michael Hudson says, “debts that can’t be paid won’t be paid.”
Do hyper-elites privately/secretly understand this mathematical reality?
You can’t squeeze blood from a stone.
You can’t wring more interest and rent and profit from the working masses than they can physically produce while also staying alive.
Right now, Americans owe more than $16.9 trillion in consumer debt. Compounding interest will guarantee that number is higher next year, and the year after that, and the year after that, and on and on until America ceases to function.
Unless we ban interest or jubilee the debt, Americans will always be in debt, and when their debts become unrepayable, the system will collapse.
The US government — supposedly representatives of the very people who are trapped in all this debt — should erase all debts right now.
What would happen if we declared a debt jubilee?
Banksters, credit card companies, predator universities, student debt bondholders, for-profit health insurance companies, would write off the loans and still walk away with more interest money than they deserve.
Naturally, predator-creditor corporations who weren’t smart enough to save for a rainy day would go bankrupt, but better them than tens of millions of members of the working poor. Corporations are just legal fictions, after all. The bankrupt businesses would then be sold to the highest bidder — ideally to cooperatives comprised of newly-debt-free workers.
Meanwhile, American taxpayers, students, sick people, indebted working people, and homeowners would be completely free of $50 trillion in debt, able to spend their earnings into the real economy, creating jobs, starting businesses, donating to charity, and investing more time in the work of civilization-building, all instead of paying interest into the pockets of rich creditors.
Debt is just usurious vapor. It’s drowning humanity, but fish don’t realize they live in water.
But what about people with pensions?
Let’s start by pointing out the deceptive misdirection in this question: That it’s poor old grannies who are the big bad bagholders for all this interest-bearing global debt.
It’s simply not true.
Yes, Social Security owns $5.3 trillion of the $31 trillion in national debt, but we need to ask an important question: Why did the elites create a pension system where the retirements of the aged are funded by exploiting the next generation of poor workers instead of taxing those who can afford it?
The answer is obvious: Because the rich who made the tax rules didn’t want to pay for the twilight years of the workforce they’d just ground to dust.
We need fundamental pension reform. Instead of taking money from the pockets of the working contributors who actually create all the real wealth in society, we should wealth tax the extractive hyper-rich who directly profited from the work of those old people for decades.
But what about inflation?
Let’s start with the acknowledgment that the US dollar has lost ~90% of its value in the past century because banksters were allowed to create interest-bearing credit out of thin air. This has caused a massive interest-bearing debt bubble — $300 trillion globally — and it’s this debt itself that is responsible for nearly all the theft-by-inflation we’ve endured for 100 years.
But never forget: One of the goals of a debt jubilee is to get rid of inflation.
How? By bursting the debt bubble. If everyone’s debts are paid off, that leaves most households will several thousand extra per month to spend. This would absolutely cause inflation if corporations raised prices to soak up that extra cash. We need to stop them from doing that, and luckily, there are plenty of ways to curb inflation without savaging the middle class with interest rate hikes:
In order to cool house prices back to affordability forever, we can introduce a capital gains tax, land value tax, and/or a ban on buying up second properties.
We can institute an innovative mandatory savings period, something that economists on the right and left support, to bottleneck the freed-up money from flooding onto the market all at once. Instead of paying interest to creditors, that money could go directly into an old-age savings account.
We could use any or all of these measures to ensure prices don’t rise in response to everyone being debt free.
Let’s not forget that everyone being mortgage-free would drop the cost of rents, a wonderful deflationary effect.
Let’s not forget that being debt-free would allow millions of people to quit toiling in jobs they hate and instead volunteer, serve in their communities, or raise their families. This would lead to less spending, which is price-deflationary.
Because more people have more money to spend on needs instead of interest, governments could cut some spending without it hurting the vulnerable. This is deflationary. They could then use those savings to build more new assets, creating further deflation.
Consumer spending inevitably trickles north to the richest of the rich, so we can always curb inflation by taxing the hyper-elites.
Don’t forget that every part of the supply chain is paying interest to banks. The farmer is paying interest on his land, seed, fertilizer and tractor. The processor is paying interest on their factory. The shipper is paying interest on their cargo ships and ports. The deliverer is paying interest on their trucks and depots. The grocery store is paying interest on its physical locations and inventory. All told, we’re all paying a dozen layers of interest on every product we buy. Erasing all debt wipes out all those interest costs, which is massively deflationary as companies rush to compete at the new bar for low prices.
But most importantly, in the long run, instead of borrowing any more interest-bearing money via banksters, we should create debt-free money. Debt owed to oneself isn’t debt, so we can just delete it from the books and be a debt-free country. This freaks out small minds because they think this will cause inflation, but in actual reality, this decreases long-term inflation because we no longer have to pay compound interest forever.
As I explain in this recent article, that’s how Canada paid for the TransCanada Highway, the Canadian Railway, and the Saint Lawrence Seaway. It wasn’t until they stopped using interest-free self-borrowing and started using interest-bearing bankster borrowing that the national debt (and inflation) skyrocketed:
Why America is doomed
A debt jubilee isn’t coming.
Because America isn’t a Christian country.
It’s a mammon-worshiping, creditor-controlled, plantation-nation on the road to corporate feudalism.
As Cory Doctorow rightly put it:
We can either stabilize finance (by coercing debtors into destroying their lives in order to keep up on [interest] payments); or we can stabilize the economy (by forgiving debts, so that producers can pay for necessities and go on producing).
Ancient cultures that were smart enough to regularly declare debt jubilees — or just ban usury in the first place — were remarkably stable for generations.
Whereas cultures like Rome were rife with debt, gambling, bankruptcy, slavery, prostitution, market crashes, and war.
Take a guess which option U.S. elites prefer.
Clearly, today’s elites don’t want America to be a democratic state like Solon’s Athens or a theocratic state like Moses’s Israel. They want to rule an oligarchical Sparta.
When the Spartan king Agis IV tried to institute land reform, he was executed by the rich.
When the Spartan king Cleomenes III tried to reform the economy and give land to all citizens, he was beaten in battle and imprisoned.
When Nabis, the last king of an independent Sparta, freed slaves and made them citizens while exiling the hyper-elites and re-distributing their vast estates to the poor, he was assassinated and the independence of Sparta was destroyed forever.
Isn’t it ironic that the word investment is a military term for surrounding people so they can’t support themselves or escape?
There is no doubt in my mind that the billionaires and trillion-dollar hedge funds that rule America will destroy any leader who attempts real economic reform in the US of A. It’s the US of Me now, and the rich would rather see America die than lose a single penny of their ill-gotten gain.
It’s the way of the world, and it will never change without a radical revival of the spirit.
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