Actually, Loan Forgiveness Is a Long-Standing Principle of Functioning Societies!

[Nevilledog]

Link to tweet

https://slate.com/business/2022/08/student-loan-forgiveness-long-history-debt.html

In 1920, the world’s most famous economist, John Maynard Keynes, was digging through old books on the economy of the ancient world, when he discovered something startling. All his life he had been taught that civilization depended on ironclad financial certainty. Without a stable currency and dependable debt contracts, commerce could not exist. Governments that meddled in such matters were thought to be asking for social chaos.

But the documents he perused on Ancient Greece, Rome, Babylon, Assyria, and Persia showed him something else entirely. Throughout history, political leaders had abolished debts and managed the value of their currencies—another way to revise debts—as routine matters of government policy. Keynes was electrified. A year earlier, he had staked his reputation on a call to cancel the largest debts the world had ever seen—those accrued by the governments of Europe during World War I. If these debts were not cleared, Keynes had argued, the international trading system would break down, leading to misery and another war. Predictably, the financial establishments on two continents responded to this apparent heresy with alarm. Now Keynes had discovered precedent for his ideas — thousands of years’ worth, from Hammurabi in ancient Babylon to Solon of Athens.

Indeed, debt relief has always been the handmaiden of debt itself. In the United States we have a formal legal process for eliminating nearly all forms of debt: bankruptcy. When debts become unbearable, people file for bankruptcy to have them discharged in court. In the 15 years preceding the pandemic, more than 14.3 million people filed for bankruptcy, and in the decade prior to the pandemic, more than 20,000 businesses filed for bankruptcy every year, with a high water mark of 60,837 in 2009. Debts are discharged every day in the United States, and have been for decades.

Not that you would know from the apocalyptic conservative outrage emanating from social media and cable television this week. When President Joe Biden announced his new student loan relief program on Wednesday, Senate Majority Leader Mitch McConnell decried it as “socialism” and Utah Sen. Mitt Romney called it a naked attempt to “bribe the voters.” Reason magazine’s Robby Soave declared it a “fuck you to every financially responsible person in the country.” These reactions belie centuries if not millennia of economic history.

*snip*

[TheRealNorth]

1. Funny how the Conservatives forget about that part of Leviticus.

[Ocelot II]

2. The GOPers who claim to be Christians seem to have forgotten that their whole religion

is based on forgiveness. What do they think Jesus died for?

[Nevilledog]

3. ...

[Progressive dog]

4. The history cited is not the history of democratic societies.

It is the history of authoritarian societies where the king or emperor bought the loyalty of those he needed and ignored those who didn't count. Bankruptcy is a newer concept, we can no longer be thrown in prison for failing to pay our debts as we could have been in Christian nations not that long ago. (

Since the 14th century, debtors could end up in prison for non-payment of debts. Insolvent debtors who owed less than £100, and who were not traders, could be imprisoned indefinitely until the debt was repaid to creditors.

Prison could be avoided by declaring bankruptcy, but only if you were a merchant or trader. Even so, the costs were prohibitive: £10, which was equivalent to 10 to 20 per cent of the average annual income for the common worker in the mid-1800s.

https://www.thegazette.co.uk/all-notices/content/100938