8:21 May 4th, 2012 | 2 notes
What they found is that as the rich got richer in the decades before the Great Recession, everyone else tried to maintain his standard of living by going deeper into debt. As income inequality grew over that period so did debt levels, because the rich increasingly invested their growing wealth in bonds and bank deposits, in effect providing money for ever more lending to the poor and middle class.
New York Times: Inequality, Debt and the Financial Crisis
12:05 Feb 17th, 2012 | 79 notes
We didn’t really know who was going to show up for the occupation. It was all a great mystery. We had to throw it together very quickly; it was thrown into our laps the last seven weeks before the event itself. Overwhelmingly the people who showed up were young ones who felt, “We played by the rules, we went to school, we studied hard, we did everything we’re supposed to do, and now not only are we $50,000 in debt with no way out, there’s no jobs because the bankers crashed the economy—they didn’t play by the rules but they got bailed out. Now we’re stuck being told we’re deadbeats for the rest of our lives, owing money to the very people who destroyed everything.”
David Graeber, “What We Owe to Each Other”
12:20 Jan 4th, 2012 | 23 notes
It is remarkable how efforts to reduce the government deficit/debt are often portrayed as a generational issue, while efforts to reduce global warming are almost never framed in this way. This contrast is striking because the issues involved in reducing the deficit or debt have little direct relevance to distribution between generations, whereas global warming is almost entirely a question of distribution between generations.
BR contributor Dean Baker
11:26 Dec 27th, 2011 | 178 notes
Anyway it only makes sense if you assume those premises; that all human interaction is exchange, and therefore, all ongoing relations are debts. This flies in the face of everything we actually know or experience of human life. But once you start thinking that the market is the model for all human behavior, that’s where you end up with.
This interview with David Graeber on “What Is Debt?” is one of the most thought-provoking things published this year about the premises of finance.
seriously, read his book. one of my top 3 of the year.
2:57 Nov 21st, 2011 | 6 notes
There are a lot of hidden gems in XKCD’s graphic on money.
Particularly, the Hogwart’s tuition has been truly enlightening to the economic struggles in the “Wizard World”.
There’s this poor, bright young man named Tom. Suddenly, some guy in fancy robes and beard, shows up and talks him into signing on a dotted line, to attend some ivy league school. Then he finds himself at Gringott’s pulling out a $300,000 loan, staring down at a future of unending debt. And don’t even get Tom started on how Dumbledore was just an overpaid academic stooge.
He begins peddling in the dark arts to make an extra buck. A small curse here or there. Of course, after a while he ends up with a serious case of class envy, and begins trying to cozy up to the rich “pure-bloods”, while eschewing “mudbloods”. Eventually, he works hard and earns himself a position of power and influence, and begins implementing policy that primarily benefits the already rich and powerful pure-bloods, at the expense of the Mudbloods and the other 99% of wizards.
Then, some other orphan shows up, he gets into Hogwarts with some gold sitting in a vault that he never worked a day for, and suddenly is the toast of the town.
Harry: “But Hagrid. How am I going to pay for all of this? I haven’t any money.”
Hagrid: “Well there’s your money, Harry! Gringotts, the wizard bank!
Tom Riddle could only take so much.
3:45 Nov 10th, 2011 | 35 notes
Two decades ago Rep. Tom Petri (R-Wis.) remarked in a congressional hearing that an income-contingent loan repayment system would be “far simpler for schools and the government to administer, far simpler for students at application, and more manageable and supremely flexible during repayment, at the same time virtually eliminating the default problem and saving immense amounts of money.”
Back then, the IRS was just moving to electronic processing of tax payments and wasn’t interested in taking on the new challenge of collecting on student loans. Now, however, the technological barriers are gone and, with the large increases in student debt burden, the political climate for reform is ripe.
(Source: Los Angeles Times)
9:30 Nov 9th, 2011 | 5 notes
While markets are ways of exchanging goods through the medium of money - historically, ways for those with a surplus of grain to acquire candles and vice versa… - capitalism is first and foremost the art of using money to get more money… Normally, the easiest way to do this is by establishing some kind of formal or de facto monopoly. For this reason, capitalists, whether merchant princes, financiers, or industrialists, invariably try to ally themselves with political authorities to limit the freedom of the market, so as to make it easier for them to do so.
David Graeber, Debt: The First 5,000 Years