Unleashing The Future: Advancing Prosperity Through Debt Forgiveness

[Huey P. Long]

Unleashing The Future: Advancing Prosperity Through Debt Forgiveness
11/28/2011
Submitted by Zeus Yiamouyiannis, contributor to Of Two Minds

Unleashing The Future: Advancing Prosperity Through Debt Forgiveness (Part 1)

Introduction:

My last article on debt forgiveness, Endgame: When Debt is Fraud, Debt Forgiveness is the Last and Only Remedy must have struck quite a chord in discussions of the future of the economy. It was re-posted on scores of websites and received over 20,000 reads on Zero Hedge. It also resulted in a reference on the Max Keiser Report and a subsequent interview with Max Keiser. This led in turn to a popularization of a term I used, “fake assets,” to denote the true nature of “toxic assets”.

The good news is that people are talking, attempting to assess the situation in real terms, and looking for an alternative to the broken system. The bad news is that this discussion has not been turned very much toward practical directions. The main contention in my original article on debt forgiveness and subsequent interview was simply that ignoring the mathematics of debt (where debt grows exponentially and real growth is limited), especially when magnified by tens, if not hundreds, of trillions of dollars of additional fraudulent debt, is a dangerous fantasy that worsens insolvency and accelerates collapse. “Extend and pretend” cannot provide an answer but can only amplify current destructive trends and delay serious preparation of an alternative.

This series outlines some of the alternatives to the current impasse.
--
1) Debt that cannot (vs. “will not”) be practically paid is not a debt in its classical sense.

2) Debt based in fraudulent lending is also not true debt in any meaningful sense, since the loan along with its obligations originated from something (private fiat) that had no valid authority or exchange value to begin with.

3) When debt systems are flooded with fraudulent currencies and claims, it is not true that someone, either the borrower or lender, will have to pay the “false value”-backed debt.

4) The mathematics of debt, even without fraud, would require periodic forgiveness or at least abatement.

5) In any rearrangement of the debt system, productivity and stakeholdership should be rewarded and parasitism should be punished.

6) Things go down and not always up.

7) The living shall not be beholden to the dead.

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Certainly, we now see scorched-earth class warfare of the 1% against everyone else, but we are ignoring an even more profound unintended warfare by an entire generation of post-WWII world citizens against the wellness and interests of its own children. How could such a destructive myopia so thoroughly pervade society and bring us this critical historical inflection point? This will be examined in the next part.


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http://www.zerohedge.com/news/guest-post-unleashing-future-advancing-prosperity-through-debt-forgiveness-part-1

[midnight]

1. K&R...

[Lance_Boyle]

2. Talk about yer SHOOTZ-PAH

"In any rearrangement of the debt system, productivity and stakeholdership should be rewarded and parasitism should be punished."

Parasitism like borrowing, benefiting from that borrowing, and then not paying back as agreed thereby harming the lender? That parasitism?

We *have* debt forgiveness. It's called bankruptcy. Maybe Zeus needs to read up on it instead of yammering about why deadbeats deserve free stuff.

[ljm2002]

5. Did you miss the part about student debt...

...a few years ago, Congress made a law that student loans cannot be included in any bankruptcy filing. It passed. There was also an attempt to exempt credit card debt, I'm not sure if that one went through or not. Point being, bankruptcy laws are being weakened such that they protect debtors less and less.

All of this is by design. That is one of many reasons why we need debt forgiveness. There is also the travesty of house prices that have collapsed, but the banks refuse to write the values down to market level, and the peons are left on the hook for artificially inflated prices. Yes, I know, "they signed the mortgage agreement". Well guess what, so did the banks. One of the provisions was, they get to repossess the home if payments aren't made. So sending back the keys should be the end of it -- the home-buyer lived up to their end of the bargain and gave back the security for the loan. Right?

Debt forgiveness, or "jubilee years", has a long history.

There's always someone around, though, to complain that someone, somewhere will get something free because of it.

Yet those same people don't seem to mind when the banksters continue to rob us all blind. THEY get plenty of free stuff, starting with the money the Fed creates out of thin air, then loans to the government at interest. Or the bailout money, that financial institutions got at near-zero interest, and then proceed to loan out (at 40- or 50-to-one leverage) at interest. Sweet deal if you can get it.

Of course anything at all that is done, any action that is taken, will not make everyone happy. The question for policy makers must be, what can we do that will be most effective for the greatest number of people?

I'm not holding my breath.

[Huey P. Long]

6. And let us not forget medical debt.

Good refutation, but my sense is this poster has no desire to educate themselves.

[Huey P. Long]

3. 'Another Great Depression is all but inevitable' -'Write off the debt'

'Another Great Depression is all but inevitable' -'Write off the debt'

video clip-
http://www.youtube.com/watch?v=rGkmgnprrIU

Sarah Montague talks to Steve Keen, one of the few economists to have predicted the global financial crisis, about the possibility of another Great Depression, and how to avoid it.

'Another Great Depression is all but inevitable' - that's the view of Steve Keen. He's been called the 'Merchant of Gloom', but he's one of the few economists to have predicted the global financial crisis. While he used to be a lone voice in challenging the economic consensus, more and more people are now listening to him. His way of avoiding depression? Write off the debt, bankrupt the banks, nationalise the financial system, and start all over again. He talks to Sarah Montague.

==

Steve Keen On Parasitic Bankers, Deluded Economists, and Why “We Are Already In The Second Great Depression”
Submitted by Tyler Durden on 11/27/2011 12:20 -0500


Everything that 'deluded' orthodox economists have done so far has been designed to aid the creditors (who remain the problem) while Steve Keen, the most familiar face of the non-orthodox economists, sees the only solution to this crisis as aiding the debtors. His interview with BBC’s HardTalk this week covers a great deal of ground from modern debt jubilees (and how they should be structured), the Tea-Party and Occupy movements (and his growing fear of historically repeating the endgames of previous economic and social disenfranchisements), and the parasitic nature of our existing financial sector.

He is unequivocal on the outcome of the status quo, as he has been for many years, citing politicians as reactors not leaders with the view that the youth movements we are seeing will force change of leadership to enable non-orthodox solutions to our simple problem – too much private debt. “Write off the private debts, nationalize the banking system, and start all over again” is his starting point but his ideas on implementation warrant some attention as he attempts to promote creative instability and reduce the destructive instabilities of capitalism – recognizing that our world is not in equilibrium as every Keynesian economist would believe but inherently cyclical and unstable.

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http://www.zerohedge.com/news/steve-keen-parasitic-bankers-deluded-economists-and-why -“we-are-already-second-great-depression

[toddwv]

4. An excellent point. Le'ts not forget that right before they trashed the economy,

the rules concerning consumer debt were drastically changed. Now consumers have a much harder time digging themselves out of debt.

It's like the private side of the economy, these so-called "job creators", didn't learn a damn thing over the past 100 years...

[Huey P. Long]

7. Yes. Discharges were shuffeled away to better enslave us. -eom

[Merlot]

8. Student loans were not dischargable even before the new BK rules