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Some ways to introduce a modern debt Jubilee

Charles Goodhart, Michael Hudson, (2018), «Some ways to introduce a modern debt Jubilee», 11 Ιουνίου

One of today’s great social concerns is the increasing income and wealth inequalities within countries, although rapid growth in China and the rest of Asia has meant that global inequality has fallen (see Milanovic 2016). An influential book by Walter Scheidel, The Great Leveler, argues that inequality will rise inevitably unless one, or more, of the horsemen of the Apocalypse occurs: warfare, violent revolution, lethal pandemics, or state collapse (Scheidel 2017). We disagree.

In many of the earliest societies, the tendency towards increasing indebtedness was held in check by debt-cancellation Jubilees which occurred regularly in states such as Sumer, Babylonia, and Assyria. One of us, Michael Hudson, has written a forthcoming book, entitled ”… and forgive them their debts”: Lending, Foreclosure and Redemption from Bronze Age Finance to the Jubilee Year, outlining how these debt Jubilees worked in practice (Hudson 2018).

The deb Jubilees contained three main elements.

-The first was to cancel agrarian debts owed by the citizenry; mercantile debts amongst businessmen being left in place.
-The second element was to liberate bond-servants, allowing them to return freely to the debtor’s home. Royal debt Jubilees freed the lower peasant classes from debt bondage, which originally was supposed to be only temporary. But these acts did not liberate slaves (mainly foreign captives).
-A third element was to return the land or crop rights that debtors had pledged to creditors, enabling families to resume their self-support on the land and to pay taxes, serve in the military and provide corvée labour in public works.

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