Global Debt Capitalism
and how we can do away with it
This post accompanies a podcast episode on whether or not the global debt mountain can be inflated away. You can listen to the episode here:
This post will be continuously updated for our paying supporters.
Global debt has been increasing fast since the late eighties. In his book Buying Time: The Delayed Crisis of Democratic Capitalism, German economic sociologist Wolfgang Streeck talks about “Debt Capitalism”. There would not have been much economic growth in recent decades without the demand constituted by the increase in private and public debt.
Of the two, state debt gets talked about far more, but private debt is much more dangerous. States can always service their debt in their own currencies. They can even repay it. Private firms and households, on the other hand, cannot legally issue money. What has caused this great explosion of private debt? Colin Crouch says “privatised Keynesianism” is to be blamed. Others believe “financialisation” is the reason.
Some already believe governments and central banks will be forced to inflate away this huge debt mountain. We do not believe this is possible without inducing a huge spike in consumer prices as well, which would unpopular with the electorate.
Yet, there is alway the alternative of monetary financing!
Essential reading:
