Debt jubilee

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  • #297354

    • Total Posts: 427
  • #297366

    Cold Mountain Trail
    • Total Posts: 8,139

    Michael Hudson: Well, the Jubilee Year of Leviticus 25 was based on Babylonian practice for over 2,000 years….exactly what was done and what continued to be done throughout almost all of the Near Eastern kingdoms — Mesopotamia, their neighboring Near Eastern kingdoms, even Persia, according to Herodotus…  A debt cancellation is needed when debts go (grow) beyond the ability to be paid, and all personal debts, all non-business debts, tend to mount up beyond what they can be paid….And the reason that the Babylonians and the early Jews cancel the debts was not because they were idealists…(or) egalitarians…debts have to be canceled by the government. And the government cancels it because it doesn’t want to make the economy fall…The reason your cancel the debts is you want to preserve stability.

    …certainly, you (c)ould cancel the debts for a few months, but just the moratorium wouldn’t work….when business begins again, they’re still not going to have the money to pay the rents, which are a rental debts to the landlords, which are the most expensive expense in businesses….you can’t let these debts accumulate, or you’re going to have defaults right across the board. The states and localities, New York City and New York state, have to pay unemployment insurance, and all the other costs associated with the coronavirus out of their own revenues (and still) balance the budget. If New York state and City have to repay all of the debts that they run up, then you’re going to have the whole character of government change….

    Brancaccio: So you’re not just talking people, families, households being released from debt, you’d like to see this extended to maybe state and local governments?

    Hudson: Yes. And already there is a discussion about how to do this for Third World countries that export raw materials, whose prices are collapsing because of the slowdown, and that are dependent on tourism. So you’re going to have a lot of governments throughout the world that owe their debts in dollars not being able to repay. So this is a worldwide phenomenon…. somebody has to lose when the debts can’t be paid. And the question is who should lose? Should it be the poorest people…wage earners…small businesses…the banks? Well, one way or another, it has to be either the banks, or else the government will simply create the money to reimburse the banks. But in terms of justice, the banks…were bailed out in 2008, their net worth and their stocks have soared in value. So, logically, the banks should lose something and bear some of the costs….What makes it hard today is that the debts are owed to the banks, and to the landlords, and to private creditors, and they’re very politically powerful. So this is going to be the political struggle or conflict that is unfolding in the next few months in the United States.

    Brancaccio: And I just learned this in preparation for talking with you today, professor, they did a version of a debt jubilee in the years that followed the Second World War in Germany?

    Hudson: Yes, that was the economic miracle…Germany canceled all debts ….

  • #297484

    • Total Posts: 1,180

    And it endured outright for two and a half centuries, and in less obvious forms past the Civil War.

    Slavery in the United States was the legal institution of human chattel enslavement, primarily of Africans and African Americans, that existed in the United States of America from the beginning of the nation in 1776 until passage of the Thirteenth Amendment in 1865. Slavery had been practiced in British America from early colonial days, and was legal in all thirteen colonies at the time of the Declaration of Independence in 1776. Under the law, an enslaved person was treated as property and could be bought, sold, or given away. Slavery lasted in about half of U.S. states until 1865. As an economic system, slavery was largely replaced by sharecropping and convict leasing.

    So when people put forward the idea that the US government could be persuaded to pass legislation formalizing debt jubilee or forgiveness …  Did I wake up this morning in another universe?  Tell me exactly how such an idea will ever find traction with the crooked Congress we have today?  In a country in which culturally for too many, human rights have always been regarded as communist rabble-rousing?

    Single payer health care and universal basic income both have better chances of passing than a debt jubilee will ever have, in my personal opinion.  I support such an idea – all of them actually – but I am pessimistic.

    The opinions and personal views expressed herein are solely those of the author, and should never be taken seriously.

  • #297492

    • Total Posts: 3,777

    stuff again.  But – if there ever is a Jubilee here in the US – the government will just do what they did with the mortgages – pay the money, but leave mortgage-holders on the hook anyway.

  • #297494

    • Total Posts: 2,778

    But the Jubilee thing was one of the examples where my Former Employer got it right.

    "Those who make peaceful revolution impossible will make violent revolution inevitable". - John F. Kennedy

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