Is today crunch time?
Nothing tried so far to tackle the Euro debt crisis has worked.
Austerity is simply like signing an economic suicide note.
Expecting repayment of much of the debt that has been incurred is wholly unrealistic.
There is no chance - as Germans seem to think possible - of us all becoming Germany's to repay the debt: we can't all be next exporters and lenders: that is an accounting impossibility.
The result is that the political model for a solution (austerity) has failed.
And the banking model (repayment) has failed.
And the German model is based on a fallacy.
We face the need for Jubilee. The Oxford dictionary defines this as:
a special anniversary of an event, esp. one celebrating twenty-five or fifty years of a reign or activity : [as adj. ] jubilee celebrations.
- Judaism (in Jewish history) a year of emancipation and restoration, celebrated every fifty years.
- (in full Jubilee Year) a period of remission from the penal consequences of sin, granted by the Roman Catholic Church under certain conditions for a year, usually at intervals of twenty-five years.
We need emancipation from debt and that is precisely what in the Judeo-Christian tradition Jubilee means.
Let's not agonise for a moment about why we have debt: errors have been made. We know that. By governments, by bankers, by economists, by those who have blindly followed them. But this is not the time for blame. This is the time for atonement: of reconciliation to the fact that those errors have been made and common acceptance that unless action is taken to address the consequences then the impact of past mistakes will haunt us for time to come.
Germany has the capacity to forgive, much as we forgave it much. None of this is possible unless they're willing to do so. But they are not alone.
But in the act of forgiveness there has also to be new hope. If we can resolve our debt crisis we can enter a new era; nothing less than a new economic paradigm I suspect. In that there can be hope. And I'm equally well aware, there could be despair.
I do know that whatever happens the existing order of ownership, of wealth and power is unsustainable: that is clearly what this crisis is about. The claims of one person on another, of one group on another, of one nation on another; all those are failing. That is what debt failure is. As a result I am not being apocalyptic, I am just stating what is true.
And yet hanging on to what has failed is the inevitable human condition.
Have we the politicians who can let go and build afresh?
Can we declare Jubilee?
Can we reorder around a new vision of what releases all that is good in humanity to achieve that which we're really capable of?
Those are questions, if not for today then for a day sometime soon.
They don't happen every day. They happen, we hope, only rarely in a lifetime. But this is such a time.
I don't know the answers.
I do have hope.
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There are two really interesting articles by Golem XIV on the specifics of a debt jubilee, well worth reading if you have time.
http://www.golemxiv.co.uk/2011/05/a-peoples-debt-jubilee/
http://www.golemxiv.co.uk/2011/05/how-to-destroy-the-web-of-debt/
Excellent stuff – recommended
Richard – this is a very important point. The cross-cancellation of each county’s debt within the EU is a logical starting point and is explained well here but I guess we can all envisage the agressive replies from those whose noses are in the trough of the system imposed by the international bankers.
Richard you write: – “I do know that whatever happens the existing order of ownership, of wealth and power is unsustainable: that is clearly what this crisis is about.”
To further appreciate the “existing order of ownership of wealth and power” visualize the entire human species as being a village of 100 families.
If this village you will find that:-
* 65 families are illiterate.
* 90 families do not speak English.
* 70 families have no drinking water at home.
* 7 families own 60% of the land, and consume 80% of all the available energy.
* 60 families are crowded onto 10% of the land.
* Only 1 family has any member with a university education.
Another sad indictment of our western (so-called civilized) society is that parents are too drained by modern living to interact with their children whose cradles are now rocked by computer games, mobile phones and other electronic gismos.
UK child poverty is also a well documented disgrace which is frequently reported/ discussed outside the UK but rarely acknowledged by the British people. Child poverty is also a far more likely cause of the recent riots than any particular political group you may blame because they are not “your” party.
The facts:-
* The UK has one of the worst rates of child poverty in the industrialised world
* Nearly 4 million children (30%) are living in poverty in the UK
Poverty shortens lives. A boy in Manchester can expect to live seven years less than a boy in Barnet. A girl in Manchester can expect to live six years less than a girl in Kensington Chelsea and Westminster.
Poor children are born too small; low birth weight is closely associated with infant death and chronic diseases in later life. Poverty shapes children’s development. Before reaching his or her second birthday, a child from a poorer family is already more likely to show a lower level of attainment than a child from a better-off family.
By the age of six a less able child from a rich family is likely to have overtaken an able child born into a poor family. Children aged up to 14 from unskilled families are 5 times more likely to die in an accident than children from professional families, and 15 times more likely to die in a fire at home. Children growing up in poverty are more likely to leave school at 16 with fewer qualifications.
End Child Poverty
Worth reminding everyone at this point that every civilisation using interest except ours has had a regular debt jubilee.
BB
Richard,
I agree with much of your assessment here. The banks have failed us, the politicians have failed to keep the banks in check and continue to fail in real reform of the banks, and I find their words sounding ever more hollow as they find ways to not deal with irresponsible lending and try to continue with ‘business as usual.’
I have a long standing involvement with the Jubilee Debt movement. We campaigned through the 80’s and 90’s for debt cancellation for the poorest countries and for a new system of international finance to stop unpayable debts from arising again. We proposed country by country debt audits, to look at whether debts were legitimate, and the complete cancellation of all illegitimate and odious debts. However, I must correct you, as Jubilee is based on justice and not on forgiveness.
Debts such as those made by the World Bank to Mobutu should never have been made. If we had a strong international financial architecture, they would not have even come into being. (Incidentally, the money is I understand still sitting in Swiss bank accounts while the ordinary people of the Democratic Republic of Congo repay Mobutu’s debts). Where the World Banks own advisors warned the debt would never be repaid, but for the political expediency (“our” kind of dictator) $4 billion was still leant to Mobutu. The debt would never arisen if the lender had not leant recklessly to Mobutu. Where is justice? Where is the culpability of the lender here? The responsibility for many debts arising is with the lender and not the borrower.
Let me expand. If a work colleague comes to me with a request for some money to put on a horse that is a ‘dead cert’ and I lend him a million pounds for this, which he then loses, how responsible am I for the creation of that debt? If I hadn’t advanced the money would there be a debt? Clearly not, my foolishness has created an unpayable debt.
This takes us away from the way that we are taught to understand debt. In our flawed system we replace the objective of justice, with the idea of the rich lender who has the power to decide whether to ‘forgive’ debts, and this way of thinking is a fundamental problem. While lenders can lend recklessly without fear of ever being held culpable, while we have no international bankruptcy system, we will always have injustice and a weak system. Until we can shake ourselves loose of this and look at debts in a legally objective way (perhaps through the formation of an independent international debt court or similar) the financial markets are simply bound to keep repeating mistakes of irresponsible lending, illegitimate debts and a circle of economic crises. They cannot help themselves!
I agree with you that we do need a new Jubilee, and in Leviticus 25 you will find the biblical concept of Jubilee is much more about justice than forgiveness. What we need in international finance is justice and we need that now.
Um… I believe the whole point of lending X billion to countries who have no hope of paying it back is self-interest. It’s important to set the interest rates at a level where the best they’ll ever manage is to pay back is a fraction of the interest so the principal remains forever unpaid. That way you turn them into a perpetual income stream. Obviously the plain ordinary people of the land, in this instance the Congo, in full cognisance of the effects wouldn’t be signing this kind of deal in the first place but politicians/dictators would, can and frequently do as they know it won’t ever be them that has to pay it back. It’s a betrayal of their electorate by politicians and it represents malevolent and deliberate debt enslavery by the lenders. The World Bank and its backers (bankers) want us under their thumb and malevolent loans of this nature offer an easy way to do it. They aren’t going to be interested in jubilees for the purpose of justice, justice isn’t the business they’re in.
BB