A certain EU country exports it’s supposed tax revenue to Greece so they can use 90% of it to pay their multinational banks. They have to do it in a currency they don’t own and is overvalued relative to their economy. The country mostly pressing for this is meanwhile running an export surplus and apparently asking the same for every economy in the region. This is not sensible economics any way you slice it.
It’s happened before in history and even has a name: debt bondage.
Private sector debt is at the highest level in recorded history. This is why the post 2008 recovery was so sluggish, since on average every unit of currency circulated has to pay for a fraction of the debt servicing cost. If it stops doing this a crisis will occur, which will either be contractionary or bubble financed by creating new debt to finance old debt. The national authority, with it’s monopoly on coercion can use it’s power to declare debts null and void (this happens all throughout history), create new currency free of debt (pure credit) and spend it into the economy. It can also create an artificial hyperinflation to reduce debt burdens, instate a new currency region altogether (money is simply legal tender subject to the laws the state dictates for it), etc
> You're drawing a false equivalence. A dollar (or a gold bar) does not represent a specific amount of goods or services that any specific counterparty is bound to deliver. So in general no, money is not inherently debt.
This is confused. A dollar is a debt/credit dual created by central bank and private finance operations.
A dollar is a unit of monetary accounting, a physical dollar is a token representation of a debt/credit entry inside an accounting ledger.
A bar of gold is a commodity denominated in a monetary value. It is not a token representation of a state enforced contract.
The government should just run deficits for financing projects and use tax for redistribution and inflation control, like it does today. The issue today is excessive private sector money creation and lack of federal deficits to offset the debt overhang created by private finance.
That’s only true of external debt. I.e. debts owed to other currency areas. Government debt is just the number of funds from the currency originator (central bank) to it’s distributor (treasury). Both institutions are a subject of the nation state, which is controlled by the government. So it’s not a “debt” in any colloquial sense of the term, neither is it an intergenerational transfer, since the souvereign nation state is an institution that both creates and enforces it’s own currency... which by definition implies it can create as much money (“debt”/“credit”) as it seems fit.
Government debt isn’t “debt” in the classical sense. Let me suggest an analogy: a bank lends you a loan at intrest, but no expiry date. You can pay back the loan at any point in the future. Not only that, the bank has no ways of enforcing you to pay it back through legal action. On top of that, you are infinitely credit worthy, you can get as much loans as you want, including loans to cover existing loans. Would you consider this a “debt”. The answer is that it’s nothing like a debt in any meaningful sense of the term, it is merely a label used because of accounting convention.
Could you “print”* an amount of money several times the world GDP and get inflation?
That depends whether te money is circulated at all. Inflation is not a function of the money stock, it happens when sellers collectively mark up their price above current market rate. This is easier to do with rising expectations of higher return. The money stock is not some magical denominator on top of a real goods numerator.
*(it’s really just incrementing a number in a database, zero production cost, so print is another misnomer)
I would love to see some research touching upon the finer points of this, I've always assumed child mortality was the leading factor. The education thing I think might be some causal reversal, women have time to study because they have less children to take care of. She can study (as well as invest in daycare) because she is more wealthy? This is just armchair theorizing, haven't bothered to look it up.
I feel like personal responsibility is one of those things that work nice on paper, but that requires forethought, correct information, good education, processing power. Then there's things like genetics, bad upbringing, peer pressure, propaganda (adverts), etc... which all subvert those. Human beings are not rational actors who can be expected to make optimal choices even most of the time. Even if we were robots in the sense of a computer program we would still have to deal with limits to complexity, information and processing time. Exerting restraint and self control is known to take time and energy, energy which is in limited supply and requires replenishing through intake of calories.
Humans are still hardwired for the state of nature where high caloric foods are a scarcity, evolution has not caught up yet. It is very silly and unrealistic to suggest that raising the profit motive above others will bring out the best results in every sphere of human endeavours.
This is a commonly held belief, but it's wrong, the dominant economic models in use today are neither rigorous (internally inconsistent, extremely poor empirical verification, major aggregation errors, lack of essential inputs) nor representative of an economy (a dynamic system, not an extremely stylized static equillibrium model). You should read Keen's book, it's point is not that those assumptions don't always hold, it's that they under _any_ real world circumstance will invalidate themselves.