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Jun-13-2010 05:25printcomments

Recipe for Revolution / Reconstruction / Renewal

If millions of Americans were to stop paying “obligations”, there aren't enough collectors, lawyers and courts to go after them all.

Revolution
Courtesy: biojobblog.com

(CALGARY, Alberta) - This article is subversive. Read it at your own risk!

1. Athens

In the sixth century BCE, Athens was on the verge of either chaos or revolution, much, in the view of some, like America today. The Eupatridae, the aristocracy of birth, controlled the government, owned most of the land and used its power to drive the poorer farmers into debt during bad seasons. Those who could not meet their debts were reduced to being serfs on what had once been their own land. Some were sold into slavery. Year by year, the social/economic situation became more and more precarious.

In 594 BCE, leaders of the middle classes asked Solon, who had an established reputation of exceptional integrity in the eyes of all classes, to accept election as archon, but with dictatorial powers to deal with the imminent social war, establish a new constitution, and promote social stability. The upper classes acquiesced, albeit reluctantly because, as a conservative moneyed man, he was of their class. They trusted him.

Solon first introduced simple but drastic economic reforms. He did not attempt to redivide the land, but by his famous Seisachtheia, or Removal of Burdens, he cancelled all debts and in one decree cleared all Attic lands of mortgages. Historian Will Durant notes that “the rich protested unanswerably that such legislation was confiscation; but within a decade opinion became unanimous that the act had saved Attica from revolution.”

When Solon was working out his laws, some got wind of his intentions and bought properties that, when mortgages were cancelled, they were able to keep without ever having paid for them. Solon was briefly suspected of colluding and taking advantage for himself until it was discovered that, as a heavy creditor, he had lost by his own law.

Those persons enslaved or attached for debt were released. Those sold into foreign servitude were reclaimed and freed. He gave amnesty by freeing or restoring all persons who had been jailed or banished for political offenses short of those trying to overthrow the state.

By releasing both the people and the nation from paper chains of debt, he was able to re-establish social balance. He was then able to create a set of fair laws, repealing most of Draco’s legislation and setting the foundation for a democratic constitution which then evolved to become the foundation for Rome, then all of Western civilization.

Five centuries later Cicero could say that Solon’s laws were still in effect in Athens. Legally, his work marked the end of government by arbitrary and changeable decrees and marked the beginning of government by written and permanent law. Will Durant called “Solon’s peaceful revolution…one of the encouraging miracles of history.”

Solon’s changes set the stage for Athenian rebirth and the growth segueing into democracy. Trade and industry had been freed of political instabilities and financial inconveniences. This began the vigorous development that made Athens the commercial leader of the Mediterranean. The new aristocracy of wealth (timocracy—rule by merit) put a premium on intelligence instead of birth; stimulated science and education and prepared Athens, both materially and mentally, for the cultural achievements of the Golden Age. As historian John Ralston Saul concludes:

Today we cannot move a step without some conscious or unconscious tribute to the genius of Solon and of Athens—a genius unleashed by defaulting on debts.” (underlining added)

2. France 17th century

Henry IV was probably France’s greatest king. He ascended the throne in 1600 after 32 years of religious wars had devastated the country. The French merchant marine had almost disappeared and three hundred thousand homes had been destroyed. Demobilized soldiers ran lawless through the countryside.

Tired of anarchy, the people of France allowed him, the business classes begged him, to make the Bourbon monarchy absolute. Royal absolutism had been the cause of civil war in England; it was the effect of civil war in France.

The first order of business was financial stability, which meant taxation. Henry made Maximilien de Béthune, the Duke of Sully, the superintendent of finance who moved against embezzlers and incompetents with such ferocious energy that he became the most valuable (and, of course, unpopular) member of the Royal Council. He is to this day considered to be one of the finest and most careful of public servants.

He was the pit bull of the administration and, as superintendent of finance also managed highways, communications, public buildings, fortifications and artillery; and, as governor of the Bastille and surveyor general of Paris, he was everywhere, supervising everything and insisting on efficiency, economy and integrity. He compelled 40,000 tax dodgers to pay their taxes. He found the national treasury in debt by 296 million livres; he balanced the books and produced a surplus of 13 million livres.

The first thing Sully did was refuse to pay the interest on the national debt. Then he negotiated lower rates of interest and, after that, refused to meet payment schedules. What he did was the equivalent of defaulting on the national debt.

Within a decade he and Henry rebuilt France. Not all reforms had matured before Henry’s assassination in 1610, but by the end of his reign France was enjoying prosperity it had not known since Francis I (1494-1547—considered to have been France’s first Renaissance monarch).

3. America, 19th century

The 19th century was primarily a century of American defaults. Loans which financed large capital investment programs, and had been assembled by private groups, were continually defaulted on. The history of the American railroads is a history of default. The history of American capitalism is largely a history of default, particularly during the panics of 1837, 1857, 1873, 1892-3 and 1907.

None of these occurred in a civilized way, à la Solon or Sully, but instead involved panics, crashes and massive bankruptcies which in turn wiped out massive debts. The result was always a short, widespread depression before the economy rebounded. In 1892-3, for example, four thousand banks and fourteen thousand businesses collapsed. As historian John Ralston Saul summarizes:

The difference between Henri IV and the American railway crashes is one of method, not content. The great depressions of the last hundred and fifty years can be seen as the default mechanisms of middle-class societies. Depressions free the citizens by making the paper worthless. The method was and is awkward and painful, particularly for the poor, but it destroys the paper chains and permits a new equilibrium to be built out of the pain and disorder of collapse.” (italics added)

He offers this key observation: “In other words, the non-payment of its debts was central to the construction of the United States.

Repayment of debt has become a middle-class value, with some vaguely religious, moral value attached to the repayment of debts. This probably stems from the insertion of God as the official supporter of capitalism and democracy in the 19th century. How many millions of middle-class Americans today have worried themselves sick—even to real illnesses—over how they were going to pay their bills?

At the same time, Wall Street bankers and brokers defaulted on tens and hundreds of millions of dollars with no apparent moral compunction whatsoever. This is the difference between people and fictitious people (corporations). If you loan me $100, I have a moral obligation to return it, no different than if I had borrowed your lawn mower. But if I borrow money from Bank of America, who have I actually borrowed it from? Certainly not a person and definitely not the loan officer. Bank of America has exactly ZERO feeling or regard for me so there is no obligation for me to feel any differently towards the company.

But, notes Saul: “The new respectability of bankers has added weight to the argument that paying debts is a moral obligation. And yet it is hard to forget that whenever a society had defaulted on a crippling debt, its economy has been the better for it—sometimes so much so that, as in the Athenian or American case, the whole fabric of society was catapulted into growth and creativity.” (italics added)

America is the most religious society outside of the Islamic countries. Yet America’s religious culture is twisted and distorted by money. The social contract has been replaced by a financial contract. As Saul observes:

The simple truth is that the collecting of interest on debt contradicts the entire history of Christian doctrine. It is not a matter of fair versus unfair interest rates. To lend money for profit was and remains a basic venal sin. In this sin of usury it is the lender who is in the wrong. The borrower has weakened in a moment of need and the lender is exploiting his weakness. This theme has reappeared constantly throughout history to justify not only default but often the confiscation of the lender’s goods and sometimes his life..”

4. America, now

4.1 The Creation of Debt

In 1983, T. Boone Pickens made a run at Gulf Oil, then the country’s fifth largest oil company. Through various forms of debt he owned 13.2% of company shares which were, at the time, selling for around $40/share compared to an estimated $114/share if the company were broken up and sold. Gulf management found a way around Pickens’s strategy and he was foiled. Pickens still made millions—money that became debt to someone else through the process. Corporate raiders gain respectability because they are backed by the nation’s top banks and financial publications like the Wall Street Journal and the Financial Times. His action was treated as if it were a bona fide takeover instead of what it was—a simple stripping operation.

In 1987 the consumer products giant Beatrice, found itself the object of a takeover by Henry Kravis and associates. They used a miniscule fragment of equity—about $40 million—to leverage a buyout of the company at $6.2 billion.

They then broke up the company and sold off pieces of it for about $3 billion. The whole process—over about 16 months—produced not a single penny of growth, but Kravis and company walked away with the $3 billion. The new owners of the spun-off units, found themselves laboring under a newly created burden of $3 billion of debt while the entire Beatrice entity—before and after—had not substantially changed. This is the reality of the modern economic system. Money and debt are created out of nothing—from thin air.

This is the basis of the modern economic system. It’s almost entirely smoke and mirrors—a paper chain of debt, profit and obligations. The machinations of the denizens of Wall Street which almost brought down the global economy demonstrated this. They created all sorts of fantasy financial instruments that, when the bottom fell out, turned out to have no value at all—none, nada, zilch, zero. As Joseph Mason, a professor of finance at Louisiana State University in Baton Rouge summarized: “The industry was self-financing, using loopholes in rules. Regulators weren’t keeping track of ownership of the capital, which became more difficult to do with the use of CDOs. The losses fed on each other.”

(A CDO is a “collateralized debt obligation”. It’s far too complicated to try to even summarize, so the interested reader can try Googling, or just go to this overview piece at: Wikipedia)

4.2 Dealing with debt

The federal budget appears to be on an unsustainable path,” said Federal Reserve Board Chairman Ben S. Bernanke during a House Budget Committee hearing on June 9 in Washington. Is it time to consider the lessons from Solon, Sully and the 19th century American railroads? Perhaps.

Some people are already going in that direction all across America as they just stop paying their mortgages, giving lenders an ultimatum—force me out if you can. Alex Pemberton and Susan Reboyras in Florida stopped paying their mortgage last summer.

Mr. Pemberton’s mother, Wendy, stopped paying her mortgage two years ago after a bout with cancer. Her lawyer, Mark Stopa filed a motion to dismiss on March 17, 2009, and the case has not moved since.

Foreclosure has been initiated against 1.7 million American homeowners. Resolving foreclosures is slow and getting slower because of legal challenges, foreclosure moratoriums, government pressure to offer modifications and the inability of lenders to cope with so many failing mortgages. Because of the ways that mortgages have been packaged, repackaged, sold and resold, an increasingly common defense for a borrow is to challenge the action, saying: “Prove that you own the loan.” Easier said than done in many cases.

The average borrower in foreclosure has been delinquent for 438 days before actually being evicted, up from 251 days in January 2008. In Florida, the average property spends 518 days in foreclosure, second only to New York’s 561 days Ten years ago the average number of foreclosure cases in St. Petersburg, Florida, and surrounding county was about 4,000 says J. Thomas McGrady, chief judge of the Pinellas-Pasco Circuit. Now there are about 34,000 active foreclosure cases. “The volume is killing us,” he says.

4.3 Here’s the bad news

Speaking at the Institute of International Finance in Vienna on June 11, 2010 financial-predator-turned-respectable-investor George Soros says Europe’s financial troubles means the world has “just entered Act II” of the financial crisis. Some of his other comments:

The collapse of the financial system as we know it is real, and the crisis is far from over. Indeed, we have just entered Act II of the drama, when financial markets started losing confidence in the credibility of sovereign debt. Greece and the euro have taken center stage, but the effects are liable to be felt worldwide.“

We find ourselves in a situation eerily reminiscent of the 1930s. Keynes has taught us budget deficits are essential for counter-cyclical policies, yet many governments have to reduce them under pressure from financial markets. This is liable to push the global economy into a double-dip.”

"The simplest case of a purely financial bubble can be found in real estate. The trend that precipitates it is the availability of credit; the misconception that continues to recur in various forms is that the value of the collateral is independent of the availability of credit."

(You can read the full text of Soros’s speech at this link)

5. Promoting subversion

What America sorely needs is a Solon or a Sully or, at the very least, the courage to face up to the economic fact that most of the nation’s debt, individually and collectively, is artificial—made up, smoke and mirrors. If you are living near the edge with your mortgage and credit cards and your credit rating is already damaged or precarious, you have nothing to lose but your paper handcuffs and leg irons. If millions of Americans were to stop paying those “obligations”, there are not enough collectors, lawyers and courts to go after them all. It would give people the opportunity to start life anew—obviously without credit or debt, but it would be a different life, one I would argue to potentially be far superior to the debt/consumption treadmill.

5.1 Adding insult to injury

There is nothing “so afflicting and fatal to every honest hope as the corruption of the legislature,” said Thomas Jefferson. Think George W. Bush.

In March, Dan L. Duncan, died at 77 of a brain hemorrhage. Had he died three months earlier, in December 2009, his wealth, which Forbes estimated at $9 billion, making him the 74th richest in the world—would have been subject to a federal tax of at least 45 percent. If he had lived past Jan. 1, 2011, the rate would be even higher—55 percent.

But, because Congress allowed the inheritance tax to lapse for one year and gave all estates a free pass in 2010, Mr. Duncan’s four children and four grandchildren stand to collect billions that in any other year would have been taxed. The one-year lapse in the estate tax was signed into law by President Bush in 2001, an accounting loophole in his package of tax cuts which the Democrats had promised to close but didn’t.

It’s remotely possible that the loophole may be closed and a tax applied retroactively. But Duncan’s heirs have both the motivation and the resources to fight and defeat such a development.

6. Afterwords

One of Solon’s laws was that the sons of those who died in war should be brought up and educated at public expense.

One thing Henry did in ending the religious wars was taught the Catholics and Protestants to live in peace. The religious liberty he granted was imperfect, but it was the most advanced religious toleration in Europe to the time.

Culturally the same discord exists between Democrats and Republicans. If someone could teach them to at least tolerate a peaceful co-existence, they would be doing everyone in the world a favour.

To paraphrase John Ralston Saul from above: The non-payment of debts may be central to the reconstruction of the United States.

============================================

Daniel Johnson was born near the midpoint of the twentieth century in Calgary, Alberta. In his teens he knew he was going to be a writer, which is why he was one of only a handful of boys in his high school typing class — a skill he knew was going to be necessary. He defines himself as a social reformer, not a left winger, the latter being an ideological label which, he says, is why he is not an ideologue. From 1975 to 1981 he was reporter, photographer, then editor of the weekly Airdrie Echo. For more than ten years after that he worked with Peter C. Newman, Canada’s top business writer (notably on a series of books, The Canadian Establishment). Through this period Daniel also did some national radio and TV broadcasting. He gave up journalism in the early 1980s because he had no interest in being a hack writer for the mainstream media and became a software developer and programmer. He retired from computers last year and is now back to doing what he loves — writing and trying to make the world a better place




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UrKiddingRight June 18, 2010 8:28 am (Pacific time)

So this isn't your positive solution Mr. Johnson? If not, when will we get to see it? As I've suggested before, my pet peeve is people who whine, bitch and moan about everyone and everything, yet make no affirmative proposal themselves in order to remain above criticism.

You're a Canadian who relishes whining, bitching and moaning about everything and everyone American, telling them how they and theirs are so bad and so wrong and that they have to "wake up and smell the coffee."

So please, please, please tell use what you think "should be done," Mr. Johnson. I and others are tired of the negatives -- let's hear your solution for hopeless condition of the United States.

Or do you just whine, bitch and moan because Salem-News pays you a few bucks and you feel grumpy in the morning anyway?

Sometimes there aren't positive, Mary Poppins solutions. Sorry to disappoint you. 


UrKiddingRight June 17, 2010 4:16 pm (Pacific time)

Finally, Daniel Johnson's positive solution! And it is ... millions of Americans should stop paying their debt obligations? Wait. That's it? That's all? This will "save" America? My goodness, this isn't even an new idea, or even one not now being implemented. "Millions of Americans" have already "stopped pay[ing] their obligations." Sometimes they do that within the context of a bankruptcy proceeding; sometimes not (they're just a bloodless turnips, why waste money on a bankruptcy proceeding). Honestly, I don't get it. How in the world is this idea new, or even something not already being done, let alone a proposal for "saving America." Seriously, Mr. Johnson, I don't get it. And what's with the "This article is subversive. Read it at your own risk!" header line. Each day, millions of American lawyers will today tell their clients to do what you are telling them to do in this article. And none of them will worry about having been "subversive" (we have a thing called the "First Amendment). You must not live in the United States. Oh -- Canada. Maybe I understand better now. This is truly anti-climactic.

I'm sorry that you don't get it. By giving historical examples, it's clear that I am not suggesting that it is "new". And the piece is subversive by suggesting that it become a policy of the American ethos. Drop the phony middle-class ethics and see the bigger picture. As Ann Landers used to say: "Wake up and smell the coffee".


Douglas Benson June 15, 2010 6:59 am (Pacific time)

You said it Ersun .Tyranny ,and slavery . I wish I was a fly on the wall when Bush said he wanted to default and what they told him the IMF ect would do if he did .Bet they made a deal for the wars we are fighting .Do us these favors and we will raise your credit limit . So how do you get congress to default when they are paid for by the banks and have so much to lose . We would have to kiss imports goodbye Oil being #1 unless we have the gold to pay for it [not a chance]. Sure our banks are within our control but the WBO IMF ect are not .They can just pull the plug on our credit and the world works on this system . We wouldnt be able to buy jack outside this country . Even the big oil countries have been forced to participate sorry no payments in gold . They are still trying to get gold instead of digital dollars . There is another side to this ,first conrol financial ,second control hired killers ,third control military . Good luck taking on our armed forces so that leaves hired killers . What do you think it would take for these guys to kill anyone in thier way ? They have the power to protect the killers Im sure the spin would be terrorists .Hell a few mill and a trip to no extradition would do the trick. The best part ,they are right here the best soldiers money can buy with some muslim fallguys to take the heat. Im out for now .Peace


Ersun Warncke June 14, 2010 11:41 am (Pacific time)

Douglas, I don't think the term bankrupt can really be applied to a government. Since the government has the authority to remake the financial system at will it is under no obligation to honor any debts. If a government tells a bank they are cancelling their debt, the debt is cancelled. End of story. A private corporate bank only exists by grant of the government, so it can be dissolved at will. Private corporate banks thrive under weak governments because with a combination of bribery and extortion they can prevent the government from exercising its authority to liquidate them when their scams get out of control. Walter Wriston, former chairman of Citibank, chairman of Reagan's Economic Policy Advisory Board for his entire presidency, and recipient of the Presidential Medal of Freedom from George W. Bush, wrote a book called "The Twilight of Sovereignty," essentially arguing that governments are irrelevant in the "information age." This, I would guess, is a well received view in the private banking community, because what Wriston does not dwell on is that individual sovereignty and freedom flows from and is inseparable from sovereign governments. The government is the people, so if the government is stripped of its sovereign authority, this is merely another way of saying that the people have lost their liberty. It is no wonder in this context that the same corporations both corrupt and hamper government at every turn, and then continually pump out propaganda about the incompetence, corruption, and ineffectuality of government. Once the government, which is the people, loses its ability to govern society, then what replaces a government of the people is private tyranny. Tyranny achieved by fraud is no different than the tyranny of a king, presumably achieved by force. In either case it is merely an individual claiming for themselves rights over others which have no basis in just law.


Colli June 14, 2010 7:13 am (Pacific time)

Subversive . . . maybe. Factual . . . absolutely!


Douglas Benson June 14, 2010 6:22 am (Pacific time)

Lets see Ersun .Our country has been bankrupt for a long time .1939 I believe and the great gold robbery by the goverment . Enter the new deal ,credit backed by making all citizens a corprate entity [your statutory name andsoc. sec.#] This is not a huge secret but not many people understand how we have sold everything to the banks . There are a bunch of folks called the Freemen who wrote letters of credit on thier accounts but are in prison right now because the only ones who can draw from those accounts are international banks making thier actions counterfitting .Big clue for ya the IMF owns everything we have or will have able to use our own credit to loan money to us. Which brings us to the UCC . Read the first few lines of the Oregon rules of court proc. and you will find that all courts are civil with a few exceptions appeals courts [because they rule on constitutional issues] I forget the other one but even criminal courts are civil and ruled by the UCC . So the banks ect are protected by the UCC .Good luck trying to get the courts to rule against the UCC even if it contradicts the constitution . I think the best news is that if the plug is pulled from the richest nation on earth its mutually assured destruction for everyone . Dont be fooled ,this downturn is a grab at real property .Here buy this home ,car,ect ,go on a trip have fun dont worry its all good. Then they shut it down and get it all back ,prices rise on staple goods ,jobs and wages take a huge hit ,only those with money make it through and those with lots of money buy up real property on the cheap sometimes renting to the very people who used to own it. This has played out over and over ,the 1980s come to mind. Anyhow time to get my swim on Im out .Peace


Anonymous June 13, 2010 5:52 pm (Pacific time)

Making up for my blunder Daniel..this is a 2 minute satire, that fits your article perfectly, and will put a smile on your face for this fine Sunday..this is funny and priceless, u will like it.
http://www.davidicke.com/headlines/35006-clarke-and-dawes-ask-the-million-dollar-questions

if link doesnt work, search "clarke and dawes ask the million dollar question'
c ya tomorrow!

Worth a smile. thanks. 


Anonymous June 13, 2010 3:26 pm (Pacific time)

quickly browse the article, but view the video and let me know what you think ok? thanks.
http://snardfarker.ning.com/profiles/blogs/canadian-government-pays

Alex Jones. I just managed not to throw up. 


Anonymous June 13, 2010 1:34 pm (Pacific time)

Rockefeller, Rothchilds, bank of England that also controls Canada, and how they made up the zionist movement that took over the U.S. as well as many other countries, yes even Canada. I learned, proof, and fact, that Canada is paying people to blog their propaganda, and Daniels writings, sometimes makes me want to ask "how much do they pay you Daniel"? Why do you delete my blogs, or edit out parts, leaving only the ones in that are positive?
going to delete/edit this one too? How about this quick link you refuse to post:
http://www.debtclock.ca/

Until you learn how to spell Rothschild, it's hard to have respect for your paranoid meanderings. Your post here, today, is approved, untouched, in its entirety. The debtclock, btw, is old news--nothing secret about it. 


Hank Ruark June 13, 2010 12:08 pm (Pacific time)

Ersun:
Thanks for comprehensive and cogent consideration re the realities of our fiscal status.
What you write here frames beautifully precisely WHY and to some extent HOW we need to reform the educational system, which is in essence foundation for the persons who go on into higher education and then to production of the advances in knowledge and technology and all-else we then mass-consume.

Most persons miss completely the inevitable close relation among those doing, how the do it, and what the consequences are for society at every level from economic to end-parts of the culture.

For some clues to putting dots together with lines to framing components, see Op Ed series currently on education and coming demanded reforms, driven precisely by these main forces in economy.


Ersun Warncke June 13, 2010 11:41 am (Pacific time)

Douglas, you raise an interesting point about pension obligations. People have been sitting idly by for decades while their social security contributions were robbed out, the industrial corporations that fund their pensions were stripped, and inflation and borrowing massively devalued whatever the nominal amount on their check was or would be. Under the present course, the U.S. government will pay out on social security (probably at reduced amounts) and continue to guarantee the private pensions of bankrupt corporations, but they will have to print so much money, that the checks will be worthless. One of the downsides of a digital economy is that you won't even be able to burn your worthless paper for heat in the winter. To add to this article, after the civil war, confederate war debts were cancelled, while the debts of the union were honored. This was a reasonable policy intended to punish the financial speculators who financed a treasonous rebellion. A similar policy would be fitting for many of the private war profiteers of our day. Default is inevitable for the U.S. government. They either have to default openly and publicly, default on their promises to confer benefits to their own people, or default through printing money. The method of default is up in the air, but the default is happening and will intensify. It is highly likely that the U.S. will eventually have to reorganize its banking system. Nationalizing the Federal Reserve into a new central bank, with a branch bank for each State, and management by representatives of each State bank would be one configuration that would probably be better than the current privately owned Federal Reserve system. Distribution of all new currency issues to State banks proportional to population would also address the injustice of the current situation where a few New York banks print money and then loan it to the rest of the country at interest. The elimination of usury is an obvious and necessary step for economic stabilization. A massive tax on interest income is the best way to achieve this in the short term, although a constitutional amendment would be a much better long term solution. BTW, we live in a State where the interest income of FOREIGN banks is EXEMPT from taxation. Try figuring out the justice behind that tax policy. Strict limits or a ban on the mortgaging of land would also greatly stabilize the economy. Eliminating financial speculation in land is crucial to having stable food and housing prices, which are the two most important economic considerations, in terms of the general well being of the public.


NMPatriot June 13, 2010 11:10 am (Pacific time)

Starve The Beast!

The Beast in this case is not the government, it's the banks and the corporations. 


Douglas Benson June 13, 2010 8:58 am (Pacific time)

Wow Dan you agree with GW Bush.Defaulting on the debt was the first thing he wanted to do .After re-classifying the Iran-Contra hearings of course. Cant have the Public in the know that the drug war is a sham and we will keep the Panama canal regardless . Anywho ,if we did what you suggest we could kiss all pensions ,savings,credit, stocks ,mutual funds ect goodbye.Tell me my pensions gone .You best make your peace with god. This only works when you have nothing to lose. Will the WBO and Co. have to forgive a lot of debt ? They have no choice that is clear. Now to the people just refusing to pay . Here come the jackbooted thugs in blue .You would see why they have been militarizing the thugs in blue real quick. The best single reason we need to be armed to the teeth. You watch ,I bet the bank lobby is allready working to fast track forclosures . Allmost forgot they would call it terrorism bet on that. The question is who wants to be first? Not me.


Vic June 13, 2010 7:54 am (Pacific time)

Great article...! Like Eddie said, maybe the best yet!


eddie zawaski June 13, 2010 7:02 am (Pacific time)

Thank you, Daniel. This is perhaps your best piece for S-N.com. Debt relief or debt cancellation has a long history as an antidote to the social imbalances caused by excessive debt. There are far more examples of the positive effects of debt relief in history than the ones you gave here, but I suppose you were constrained by time and space. I would like to add just one more to your list, the Argentine default of 2001. At the time of the default, there were many signs of economic distress in Argentina, but none more clear than the slide of of most of the population into extreme poverty. A large portion of the middle class in Argentina had been stripped of its wealth by debt and these people were in danger of becoming permanently impoverished. Once the international debt had been cancelled, the government was able to divert its financial resources away from debt payment and onto economic stimulus to benefit working people. Nine years later, the Argentine economy is stronger than it has ever been and the number of people living in poverty has been reduced from over 50% in 2001 to less than 20% today. I can imagine that some of your readers might think that debt cancellation might have worked for Americans in the nineteenth century, but could not work today. Our example here in the southern cone proves that debt relief works in the twenty-first century, perhaps even better than in the past. Wake up, America, you have nothing to lose but your debt.

Thanks, Eddie. 

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