David Graeber

"Revolutionary constituencies always involve a tacit alliance between the least alienated and the most oppressed." - David Graeber

America's longest period of expansion - the post-war boom - kicked off with the lowest levels of debt in living memory (wartime wages boomed, while wartime shortages left consumers with nothing to buy). Every recovery since has increased the economy's debt-to-asset ratio. 14/

Desperate, broke people are willing to work for ever-lower wages, which puts downward pressure on EVERYONE'S wages. Hudson: "Rising debt overhead serves the business and financial sector by lowering wages while extracting more interest, financial fees, rent and insurance." 13/

And in China, where most of the finance sector is state owned - where banks are public utilities - debts were suspended: "debts, rents, taxes and other carrying charges of living and doing business cannot resume until economic normalcy is able to resume." 10/

Canada and many EU governments simply assumed the payrolls of firms, relieving them of their major expense and providing ready cash to consumers that the can use to purchase from those retailers that remain. 9/

It's worth contrasting the US approach - the $1200/person bailout, the $6T finance bailout - with other countries that are less beholden to their finance sectors. 8/

And now the US real economy - the wage-generating (and thus debt-servicing) economy - has ground to a halt. The finance economy continues to boom, largely on the (obviously false) premise that debts will continue to be repaid. 7/

Between mounting costs for housing, education, transport and health - a place to sleep, a path to employment, a way to get to work, the physical capacity to do your job - being alive has meant increasing your debt burden. 6/

This is a very sharp observation in the US context. The 2008 crisis was "solved" by bailing out finance, not people - and so the finance sector was able to lend to consumers to buy things again, while consumer debt mounted to spectacular levels. 5/

Hudson's oft-repeated golden rule is "Debts that can't be paid, won't be paid." That is to say: making it harder to declare bankruptcy, or binding debtors over to arbitration or wage-garnishing won't actually get them to pay debts they cannot afford. 4/

If you've read U Missouri econ prof Michael Hudson's writings on the subject, you know that for millennia, rulers in these circumstances simply wiped out the debts, declaring a "jubilee" that allowed people to rebuild after disasters rather than being trapped in debt spirals. 2/

Eventually there comes a reckoning. Debts that can't be paid won't be paid. Business as usual has been to "let creditors foreclose and draw all the income and wealth over subsistence needs into their own hands." But that's no longer possible. We've hit bottom. 15/