Ponzirama

There’s Madoff. Then there’s Social Security according to Rick Perry. Now here’s an essay (from a website about a book) that ups the ante. Ellen Hodgson Brown argues that the entire global financial system is a Ponzi scheme.

Brown elegantly shows how the whole notion that the national debt has to be paid down or paid off is a red herring, a fundamental misunderstanding of how the system works (money is debt; the national debt is, essentially, the national money; it is therefore constantly both paying itself off and recreating itself in the normal course). But she also shows how leaving the creation of the debt/money supply in private hands, as it is now, keeps interest from circulating back into the economy where it can be earned back by debtors and used ongoingly to pay their debts, making the system unsustainable. Essentially this creates toxic debt sinks that eventually have to fill up, so that the deficit fretters end up being right albeit for the wrong reasons. She recommends public banking as the solution, which as she describes the problem does seem sensible, albeit further infuriating for the Ron Pauls (warning: balky script at this link) of the world.

The essay clarifies some things nicely and I recommend it. At the same time I’m suspicious of this kind of clarity, which feels a lot like the sort of self-help advice where everything will be cool if you exercise, eat right and get plenty of fiber. I have this intuition, maybe small-minded and self-serving, maybe I can get some Dao cred, or maybe it’s the same thing, that problems on a global scale are fundamentally unfathomable, indeed that to treat facts at that scale as problems is a kind of existential category error. Of course I know better from Marx, but then again we’re still waiting for Marx to pay off on the solution side.

Advertisement