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That old adage: If you owe the bank a million, the bank owns you. If you owe the bank $2.5 billion, you own the bank. You can only lend money to people (or Sta

That old adage: If you owe the bank a million, the bank owns you. If you owe the bank $2.5 billion, you own the bank. You can only lend money to people (or States) you see as equals. Large scale lending essentially ties your economies together (like the US and China). I highly recommend Debt: The First 5,000 Years by David Grabber. He does a great deep dive into the history of debt (both personal and with States). It's an amazing read.

barry-cotter 7y ago
> You can only lend money to people (or States) you see as equals. Large scale lending essentially ties your economies together (like the US and China). Debt can also be a thinly disguised bribe if there’s no real expectation that it’s ever going to be paid back. That’s how most lending to extremely poor countries works. The US or other “donors” lend money to the local tyrant to support domestically unpopular policy; the local tyrant pockets a large amount, distributes some to their cronies and some goes on the titular reason for the aid and at some point in the future the debt gets written off. Then the cycle repeats. The US does not view any other states as equals. China has lent a lot of money to Sri Lanka and Cambodia among others. It does not view either as an equal. > I highly recommend Debt: The First 5,000 Years by David Grabber. He does a great deep dive into the history of debt (both personal and with States). It's an amazing read. It’s also riddled with factual errors, from saying Apple was founded by engineers working on their ok laptops or that the Fed isn’t part of the USG, among many, many others. Long post on a small selection of the ways the book gets things wrong. https://delong.typepad.com/sdj/2013/01/the-very-last-david-graeber-post.html https://delong.typepad.com/sdj/2013/01/the-very-last-david-g...

barry-cotter 7y ago

> You can only lend money to people (or States) you see as equals. Large scale lending essentially ties your economies together (like the US and China). Debt can also be a thinly disguised bribe if there’s no real expectation that it’s ever going to be paid back. That’s how most lending to extremely poor countries works. The US or other “donors” lend money to the local tyrant to support domestically unpopular policy; the local tyrant pockets a large amount, distributes some to their cronies and some goes on the titular reason for the aid and at some point in the future the debt gets written off. Then the cycle repeats. The US does not view any other states as equals. China has lent a lot of money to Sri Lanka and Cambodia among others. It does not view either as an equal. > I highly recommend Debt: The First 5,000 Years by David Grabber. He does a great deep dive into the history of debt (both personal and with States). It's an amazing read. It’s also riddled with factual errors, from saying Apple was founded by engineers working on their ok laptops or that the Fed isn’t part of the USG, among many, many others. Long post on a small selection of the ways the book gets things wrong. https://delong.typepad.com/sdj/2013/01/the-very-last-david-graeber-post.html https://delong.typepad.com/sdj/2013/01/the-very-last-david-g...