Indebted to Whom?

In God We Trust, but banks?

 

 

All countries - that's all countries - are in debt. Fact. As of 2015, that debt was $59.7 trillion. So if countries, governments; don't owe each other, just who holds the paper on these debts? Simple answer: banks. For instance, and I think some might find this weird - I know I do - Japan's had the largest part of its national debt held by its own central bank. Am I alone in finding that a bit circular? Similarly, China; its debt the charge of both some domestic banks and tellingly, mostly by the state-owned banks. This obtains world-wide.

We are being told that the debt that we could rack up due to the Covid pandemic, if we continue to support businesses and individuals whose livelihoods are being ruined through no fault of their own, is simply unsupportable. How on earth can we countenance a system's continuance where debt is simultaneously owed and owned by effectively the same entities? It is simply nonsense.

When the world is on a war footing, money becomes no object; there are no fiscal barriers to spending and achieving goals in the national interest; at least until the cessation of physical hostilities, when financial hostilities and the calling in of debts resumes. It really is time we called a halt to this ludicrous pantomime. Money is notional, a confected means of abstracting exchange, no more.

It is in the gift of governments, supposedly the servants of their electors, to simply 'circuit-break', to use the current Covid buzz-phrase, the economy and 'borrowing' where the borrower and the lender are largely one and the same thing. If we are to get through this pandemic in any fashion, one thing is for sure; without maintaining the economy and the livelihoods of our people in the short term, the climb out at the other end of all this will be difficult at best.

The collateral damage to so many of us on the way through will be catastrophic; lives and livelihoods ruined and political trust gone: look no further than to the Germany of the 1930s, as the bellwether of our potential near future. The populist rot started four years ago and we don't seem to be learning lessons fast enough to halt the inevitable: if we continue on our present trajectory, then God help us all.