Thoughts on Debt RepudiationGreg Johnson
French translation here
In Ancient Athens, debtors who were unable to pay their creditors lost their land and were reduced to serfs who had to give their landlords one sixth of their produce in perpetuity. If the debt exceeded the debtor’s total assets, he and his family were reduced to slavery. A debtor could also become a slave by pledging his personal freedom for his debts.
By the 6th century BC, serfdom and slavery had become so widespread in Athens that the small landowners and militia men who were the backbone of Athenian society were disappearing. Wealth and power were becoming concentrated in the hands of a few families through the black arts of usury. Athens was thus in danger of losing the freedom guaranteed by its large, landed middle class, which was increasingly unable to resist the power of the rising plutocratic elite.
Thus to preserve republican government, the Athenian lawmaker Solon (c. 638 BCE–558 BCE) instituted the Seisachtheia, from seiein, to shake, and achthos, burden, i.e., to shake off the burden of debt. Solon’s debt repudiation cancelled all outstanding debts, emancipated all slaves and serfs, and returned all property seized by creditors. Solon also instituted a legal limit to property size, to prevent the concentration of land into the hands of a few wealthy families.
Similar forces were at work in the Roman Republic. Debtors who defaulted could lose their property, their freedom, and even their lives to usurers. This led to the concentration of power and property in the hands of the few and the decline of the small farmers and legionaries who were the foundation and strength of the Republic.
Rome, unfortunately, lacked a statesman with the vision of Solon. There was no wholesale debt repudiation, but some palliative measures were passed. For example, one of the provisions of the Lex Licinia Sextia of 376 BCE was the distribution of captured lands to establish small farms. The Lex Poetelia Paprina of 326 BCE abolished debt bondage (nexum).
But, as Brooks Adams summarizes so compellingly, the unrelieved march of usury—along with deflation and cheap slave labor—was one of the chief causes of the destruction of Roman freedom. (See Brooks Adams, “The Romans” and my own “Brooks Adams on the Romans.”)
Debt repudiation is also described in the book of Leviticus, where it is instituted on a 50 year cycle. In Leviticus 25:10, it is commanded: “Consecrate the fiftieth year and proclaim liberty throughout the land unto all the inhabitants thereof: it shall be a Jubilee unto you—and you shall return every man unto his own clan, you shall return every man to his family.” This is taken to mean the abolition of debt slavery and indentured servitude.
The Jubilee is also connected with land reform. In Leviticus 25:23 we read: “The land must not be sold permanently, for the land belongs to me. You are only foreigners, my tenant farmers.” In Leviticus 27:21 we read: “When the field reverts in the Jubilee year it shall become holy unto the LORD, as a field set apart; and it shall become owned by the priests.”
The purpose of the Jubilee seems to be the prevention of the concentration of land (the primary form of wealth in pastoral and agricultural societies) in the hands of a few families through usury, which results in the loss of land and liberty for debtors who cannot pay. Presumably, after the Jubilee, when land reverts to God (under the administration of the priests), it is again divided up among small farmers, including newly freed slaves and indentured servants. The idea that all men are tenant farmers of God means that no men should be tenant farmers of other men, which is a strong affirmation of the idea of a society of small, independent farmers. (It is ironic that the ancient Jews argued against usury and debt slavery and in favor of agrarian populism, given the economic profile they later assumed as urban money-lenders, traders, and professionals. Apparently Jews had become an overwhelmingly urban and non-agrarian people by late antiquity.)
The common assumption of the Solonic Seisachtheia and the Biblical Jubilee is that freedom is a high political value. Freedom, moreover, is best secured by a society in which as many men as possible are free and able to support themselves on their own land. Freedom requires private property that is widely distributed. Over time, however, debt and foreclosure lead to the concentration of wealth and power into the hands of the few, leading to the loss of freedom. Thus the preservation of freedom requires wholesale debt repudiation
The fate of debtors has become easier over the centuries. Debt slavery and serfdom are no more. Debtors’ prisons were abolished in the United States beginning in 1833 and in the United Kingdom in 1869. Bankruptcy laws allow people to escape crushing burdens of debt.
The moral premise of bankruptcy laws is that individuals should not have their lives and prospects ruined by financial mistakes. Society as a whole is better off if a man can shake off his debts and focus on the future: pursue an education, start a family, start a business, etc.
But if it is right for individuals to shake off their own debts, then it is certainly right to shake off the debts imposed upon us by others, including people who are long dead, i.e., public debts. Life is lived forward. Ascending life should not be shackled by the dead weight and accumulated mistakes and debts of the past.
Debt may no longer lead to slavery or prison. But debt still corrodes freedom is subtler ways. Those who are self-employed have more liberty of thought and action than employees, who are pressured to conform to the opinions and tastes of their employers. For the same reasons, property owners are freer than renters. And debt and foreclosure are the major factors in turning the self-employed into employees and property owners into renters. Thus if we wish to reestablish a society with a large middle class of self-employed farmers and businessmen, we need to revisit the idea of debt repudiation.
America’s national debt is now beyond $15 trillion and counting. The debt now approaches $50,000 per American citizen, $135,000 per taxpayer. Unless we have radical change, it will only get bigger. And in addition to paying those debts, taxpayers will also have to fund Social Security, Medicare, and Prescription Drug liabilities approaching $120 trillion and counting. That means that every white baby born today is saddled with $1.2 million in federal debts and liabilities (provided that he becomes a producer not a parasite). And this does not include state and local government debts.
But ask yourself: when a pregnant Mexican sneaks across the border to drop her “anchor baby,” is she bringing America another taxpayer to assume $1.2 million in debts and liabilities run up by Gringo politicians? Or is she here to add to the burdens that must be borne by white children?
Remember this when the eyes of immigration apologists grow moist describing the travails of hard-working people from around the globe who only wish to “contribute” to the great American experiment. Are they here to contribute more than $1.2 million apiece? Obviously not. They are coming to take, not contribute. They are coming to add to our burdens, not share them. Ultimately, they are coming here to replace us and our posterity. And when they are the majority, they are not going to go on laboring to feed and medicate old white people. They are going to pull the plug and take care of their own.
In addition to public debt, Americans also have trillions of dollars in personal debts, primarily in the form of credit cards, home mortgages, and student loans, some of them accruing interest at ruinous rates.
Nobody seriously thinks that all of these debts will be repaid. It is not a question of whether they will be repudiated, but how. The most likely method will be the devaluation (inflation) of the dollar. Someday, you might have the choice of paying $100,000 to pay off your student loans or to buy a cup of coffee. And since we’ll always be able to buy a cup of coffee, maybe hyperinflation would not be such a scary prospect, except that it creates economic and social chaos.
Beyond that, inflation is deeply unfair. When the currency is inflated, it is not all devalued at once. Instead, huge amounts of money are handed over to politically connected insiders. When they spend this money, it has the purchasing power of the previous day’s non-inflated currency. But with every subsequent transaction, as the value of the money is discounted, its purchasing power drops. So the first man who gets to spend a $100 bill can buy a nice dinner for two, but the last man who spends it can’t afford a taco. That can only lead to further concentration of wealth in the hands of parasites.
From a White Nationalist point of view, the most important thing is to accomplish debt repudiation with a minimum of interference in the real economy, particularly the core biological functions of the economy: the preservation and reproduction of our race. We cannot have bursting silos and empty stomachs. We can’t have creditors seizing real assets for merely notional debts.
But before we deal with practical questions, we need to deal with the moral question of the rightness of debt repudiation.
Two points of clarification: First, I am not arguing for the wholesale repudiation of debts between individuals or businesses. Sometimes such debts need to be repudiated, but this can be handled with existing bankruptcy laws.
Second, I am not arguing for the wholesale repudiation of Social Security, Medicare, and other such entitlements. I believe that these sorts of programs ought to exist in some form. The existing programs should simply be improved, not abolished.
What I specifically wish to establish is the morality of repudiating government debts and all private debts to banks.
Ultimately, only the ends justify the means, and in this case, debt repudiation is justified as the means to restore and preserve a society with widely distributed, securely held private property, which is the foundation of a large and powerful middle class. Aristotle argued that such a society best equips the majority to resist the tyranny of elites, although Aristotle could not have imagined the ultimate in tyranny: an elite so wicked that it would work for the destruction and replacement of its own people.
But debt repudiation would not merely help preserve our people. It would also simultaneously strike a blow against our enemies, who are deeply invested in the financial sector of the economy.
Let’s deal with government debts first. The moral principle behind public debt is that governments, acting in the common good of the people, can create collective obligations, such as laws, treaties, or debts. Although one can question whether many government policies really are in the common good, I accept the underlying principle that there are collective goods that can justify collective obligations.
My question is: Why do governments need to go into debt in the first place? Why do governments have to borrow money at all when they can either (a) print it, or (b) raise it through taxation?
In the past, currency consisted of scarce bits of shiny metal. If the government needed more of these bits than it could raise by taxation, it had to go to people with hoards of coins and borrow them at interest.
But in today’s world, in which governments can simply print money, why is there any need to borrow it from banks? Particularly when the banks themselves just make up the money they lend out.
Thus my argument is simply that public debt is wrong because it is not necessary. It is, therefore, fraudulent to justify public debt in the name of the common good. Public debt is actually a way of making the society as a whole—specifically, the taxpayers—subservient to private interests (banks) and even to alien peoples (market dominant minorities, foreign governments).
But a free people should serve its own interests—and, I would argue, the higher interests of life—not foreign interests or private interests. Such debts should, therefore, be repudiated.
As for the foreign governments holding US bonds, we should offer them the following compensation. They can keep all the factories that American businesses have built over there, and they can use them for domestic production. Because debt repudiation should go hand in hand with the restoration of economic nationalism, including tariffs on imported manufactured goods. So businesses that wish to sell products in the United States should have to manufacture them here.
As for the repudiation of debts to banks: this is necessary, because existing debts can never be repaid, and it is moral for the reasons already laid out above. Beyond that, it is morally absurd to hold that banks, which create money out of nothing, have a right to demand the repayment of their principal plus interest. In the end, however, the case for the repudiation of bank debt rests on the existence of a viable alternative financial system, some elements of which I have sketched in my essay “Money for Nothing.”
The repudiation of government and individual debts should be a political imperative for White Nationalists. When White Republics emerge, we will of course repudiate the debts of predecessor states. But even within the present system debt repudiation should be stressed by White Nationalists, for it would prove a very popular political plank. Debt repudiation would also be useful to break White Nationalists away from the dead ends of Republican conservatism and “free market” economic orthodoxy.
Of course the primary aim of White Nationalism is to secure the existence of our people and a future for white children. But if that does not get people’s attention, then promising to cancel their credit card, student loan, and home mortgage debts definitely will.
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Remembering Richard M. Weaver (March 3, 1910–April 1, 1963)
If you want to visualize America’s debt of 15 trillion dollars or its unfunded liabilities of over 114 trillion in terms of one hundred dollar bills, see http://usdebt.kleptocracy.us/ It’s quite a sight.
I don’t think mounting consumer debt is so much a threat to our demographic. I think we manage debt well, on balance. The irrational ballooning private debt is probably mostly in the hands of minorities. That facet of your proposed strategy will probably only help these to pay for their wide-screen TVs.
Also, please stop calling medicare and social security “entitlements”. This is a pejorative invented by our current political elite who want to rob these programs–or rather, not to have to pay back the money they’ve already robbed. We pay into these programs in separate designated taxes, so we are entitled to them. In a just economic system, I agree these should be eliminated, however.
The vast bulk of individual debt was not run up on credit cards by negroes buying bling. Most blacks don’t have checking accounts, much less credit cards.
Most of this debt is in the form of home mortgages and student loans, and most of the debtors are white people. Responsible white people who want to better themselves go to college, and when they want to raise a family, they buy a house in a suburb. White Nationalists need to take the side of people like that.
We particularly need to tell young white couples that we think they have something better to do with their time than servicing debts. So we will cancel their student loans and mortgages and hand them their educations and homes free and clear.
The best way to do that, though, might be to follow the examples of the Nazis, who capitalized family formation and forgave portions of the loans whenever a new child was born.
I defer to your authority, O Fuhrer.
Great article! I hope I live to see these days.
In general I’d agree with some of this, but I think neither of us is an economist.
We learned at our Prctical Politics seminar in Tennesse that 70% of any population are
naturally psycological slaves to defending what ever is the long established dominat ideology, which now means they are as suicidal as Jones Town parishoners.
So yes we have to have a bankruptcy law as an out for such near mindless robots.
But we may be rearranging the deck chairs. The ecomonist Rober Precther has stated that what the West may be in for is something as rare and as devastating as the Fall Of the Roman Empire.
We maybe should be more into forming close knit white community survival groups, which is just what happend around 500A.D.
Clearly even the pratorean guards are beginning to defect from the system. There were the Verteran Intelligence Professional for Sanity at the start of Iraq War II.
Then there is Sheriff Mack and his Constitutional Sheriffs organization, and most recently the Oath keepers organization of current and former military and police against the developing dictatorial system.
Oath Keepers leader, Stewart Rhodes, recently stated that in absense of a repeal of the provisoins of the NDAA for military indefinate dention without trial of any person so selected by the executive branch, we are about at the 1774 time frame. Barring nullification Rhodes thinks we may be in for a patriots asymetrical war scenario similar to the Southern Campaign of 1776-1784.
There was a time when most American families were supported by freeholding farmers and small businessmen. Our genes have not changed that much since then. We have not yet become natural slaves.
I disagree with your contempt for people who go bankrupt. That attitude is injected into our culture by usurers who feed on it. Our much hardier agrarian ancestors also got into debt. So did the legendarily tough legionaries of Rome and hoplites of Athens. Debt is not necessarily a sign of incontinence and vice. Agriculture is a very precarious living. Sometimes, farmers are driven to debt because they are so productive that the market price of their commodities drops below the cost of production.
One of these days, I need to do an inventory of the moralistic fallacies about debt that sustain the ursurocracy.
“One of these days, I need to do an inventory of the moralistic fallacies about debt that sustain the ursurocracy.”
Great idea. Sorely needed. I look forward to it.
I really like your articles on economics, Greg. Not least because I am a total illiterate on the subject, so it is good to start thinking in that direction.
“America’s national debt is now beyond $15 trillion and counting. The debt now approaches $50,000 per American citizen, $135,000 per taxpayer. Unless we have radical change, it will only get bigger. And in addition to paying those debts, taxpayers will also have to fund Social Security, Medicare, and Prescription Drug liabilities approaching $120 trillion and counting. That means that every white baby born today is saddled with $1.2 million in federal debts and liabilities (provided that he becomes a producer not a parasite). And this does not include state and local government debts.”
Where did you get these numbers?
That’s so meaningless (at least to my pea brain). It’s like trying to visualize all the stars in the universe.
No one is getting that money back, why does anyone pretend?
THEIR GOAL IS GENOCIDE. OURS. WHAT’S YOURS?
Flavia in blockquote:
They don’t want “THAT money back.”
THAT money is a claim on the goods and services, present and future, of the people of the United States of America.
They don’t WANT it “back.” They want it to remain just like it is, where they get intererest on the money from your current taxes – that they ARE getting – along with more control over the economy, the politics, and the future of the people of America.
What’s In YOUR Future? Focus Northwest!
According to the Federal Reserve website
The total credit market debt as of end of 3rd quarter 2011 is nearly $54 trillion.
Debt is founded on fraudulent credit creation or parasitic lending. Personal debt accrues because the purchasing power – wages and salaries – is not equal to the good and services available, hence the necessity of many to go into debt and pay back the original loan plus usury, which in turn sucks more money out of circulation among consumers, thereby compounding the problem. References to most personal debt being owed by darkies too irresponsible to know what they are doing, or other ne’er-do-wells, is nonsense. The whole system operates on debt, personally, nationally and globally. Even the much-maligned welfarism is not an economic problem as much as a social, cultural and moral problem. Welfare recipients are scapegoats for those who are too stupid or too evil to seek alternatives to debt finance. If money and credit are in circulation proportionate to the goods and services available, then it is not crucial whether that purchasing power is available even through welfare. Social Credit calls it something else : a National Dividend, given to all as a birthright.
You’re not going to get much sense out of a trained ‘economist’. Economists don’t even know how credit is created. C H Douglas was an engineer, and I think, Gottfried Feder: practical men who saw how things worked – or didn’t work.
Right you are, Greg, about getting people’s attention. If and when WN grows into a real political force to be reckoned with, debt repudiation and a populist economic platform are essential in achieving political power. Although it may change, appeals to racial reason currently don’t register with most White people, but greed and economic self-interest always do. The economic issue will be the key to unhinging the Judeo-plutocratic system.
Is our debt even comparable though? I think “advanced” financial instruments and fiat currency have allowed Americans to borrow more than anyone has borrowed ever before. I am not sure about economics of the past, but I doubt Rome was ever in a hole this big.
And (ideally) would the jubilee include just consumer debt/student loans? Or would it also encompass America’s debt? There is something so satisfying about being all: “Hey China, we don’t have your money. Suck it.”
Personally, I have never had debt in my life. It just never made sense to pay extra money so I could have things. If I wanted something I always saved.
The Jubilee most certainly should include Federal, State, and Local government debts. China can keep the junk factories. No white child will be born into debt peonage to the Chinese.
THEIR GOAL IS GENOCIDE. OURS. WHAT’S YOURS?
The situation in Ireland has been papered over for the moment, but a day of reckoning grows closer.
One Irish academic wrote in the paper of his solution to Ireland’s external debt problem.
1. Tell the external debt holders that Ireland will not pay one more penny to them.
2. Run a balanced budget. If that means the pensioners take a hit for a few years, that is a small price to pay for their children to have the chance for a better life.
3. The banks will effectively placed into receivership, like the Scandinavian model, and not sustained artificially by the taxpayers. Effective bank shareholders get nothing, and bank bondholders get little. How to liquify the banking system? Remember the external debt holders in (1)?
4. Their external loans can be converted into the stock needed for the new banking system.
What’s In YOUR Future? Focus Northwest!
“The Jubilee most certainly should include Federal, State, and Local government debts.”
This is an important feature of my preferred plan. If you would like to discuss the details of it contact me.
hence the necessity of many to go into debt
But there are people, who through frugal living + some good luck (the kind they make themselves), don’t ever have to borrow a cent. They are a tiny fraction, but they are there. Others are in debt, but are careful to keep it to a minimum. “Goods and services” are all being assigned the same weight in these discussions, as Fibbles touched on.
Whether we are talking about
(1) an individual’s “private” debt to his loansharking institution (bank) or
(2) government debt, or even
(3) me lending my neighbour $100.00,
it’s still all of a piece and we therefore can’t legitimately make any distinction. If only the first 2 types of debt were repudiated, it would be unfair for the 3rd kind to remain in place because the entire superstructure (society) is based on debt and has been for a long time, i.e.,this is an omelette that can’t be unscrambled, and the eggs were rotten in the first place.
We would have to have utter, complete, devastating total collapse, economic and social, and then start fresh from square one in order to get rid of debt without creating massive resentment in some quarters, which is sometimes rational and normal.
There is a myth that debts can be avoided by “frugal” and virtuous living, hence people who are in debt bear guilt for that very fact, and if they can’t pay, that is treated as prima facie evidence of vice. These attitudes are created and sustained by usurers. But, for the most part, they are untrue.
Responsible people in our society go to college, and they have to borrow to do that.
Responsible people in our society want to raise their children in decent neighborhoods, and they have to borrow to do that.
Productive farmers are often financially destroyed and driven into debt because they are so productive that the price of the commodity they produce falls below the costs of production. Agriculture is particularly liable to this because there are many producers producing the same homogeneous products, like wheat or barley. And in the past, the vast majority of people were involved in farming.
Responsible people in our society go to college…
They sure do! And if they are smart as well, they’ll take Wimminz Studies and go to work for Social Services and belong to the public service union and then retire at 55 with a gold-plated, indexed pension. Hot damn, life can be good.
Okay, I’ll have a look at your Politics of Resentment.
The difference between your loan of $100 to a neighbor and government debts and debts to banks is immense. You presumably worked for the $100. You did not just create it out of nothing. So if your neighbor refused to pay, that is just theft. Now maybe he can’t pay. Maybe there are extenuating circumstances. Maybe he can persuade you to forgive the debt. But if he defaults, that is a real loss to you, and a real harm to the fabric of your community.
Debt repudiation needs to be as surgical as possible, and as I said, it needs to be done with as little harm as possible to the real economy and the community.
Finally, resentment is not necessarily a bad thing. White Nationalists need to stoke and ride populist resentment all the way to power. One of the many ways that we have to separate ourselves from conservatives is that they can never win because they are controlled by people who instinctively fear populism — i.e., by businesspeople who fear they will lose from populism. See my piece, “The Politics of Resentment”: https://counter-currents.com/2011/03/the-politics-of-resentment/
Brilliant essay. I’ve been thinking along these exact lines for years now. This is a rare occasion of finding an echo to my thoughts.
In fact, I was toying with the idea of writing a similar essay with similar feature ( e.g. references to Solon etc.). The Roman record is much richer and more extensive on this issue. Getting all of the relevant laws straight has kept me from initiating it.
(Also worthy of note is the institution of the MONTI DEI PASCHI in Italy during the Middle Ages. The Monti is the oldest bank in existence and was predicated on practices compatible with debt relief.)
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