Thursday, January 25, 2024

Letter: Debt (2010)

Letter to the Editors from the January 2010 issue of the Socialist Standard

Dear Editors,

The prophetic words that capitalism would create its own gravediggers can be interpreted in many ways. It may be understood to mean that, as a result of exclusion from the enjoyment of the fruits of their labour, a growing number of the population will rise up, enlightened and intellectualised, and revolutionise its dynamics to alter our direction, aims and desires; we hope towards socialism.

It could also be interpreted to mean that through its failings, inefficiencies and uneconomical ways, that it may self-destruct, that it becomes apparent to all, impossibly illogical even, that it must without doubt be surpassed in face of any remnant of opposition that may linger in the nooks and crannies of its many alleyways.

It may be bits of both of these. It is probable that it is bits drawn from the many other facets of life within capitalism. No doubt.

What is becoming increasingly apparent is that its very ‘rules’ if we may call them that, are losing the ability to defend and provide justification for its continuance. One such that has been discussed at great length, possibly more so than at any other time, is that of debt. We are told that our nation’s debt is of such magnitude that we should all prepare for many hard years ahead. That we will prevail over this debt but only by taking hard choices, there will be no easy option and many may suffer, but together we will defeat debt.

Now, if we can just for the moment try not to conjure up the image and inevitable analysis of ‘debt’ becoming an outside ‘alien’ thing, out of our sphere of control – rather absurdly in much the same way that wars or terrorists are often spoke of – and consider their grand solution to it by seeking to increase its availability, we may welcome its arrival and the simple opportunity that it provides.

We can now talk of debt as a bad thing – as a sign of failure. All of us wish we had less of it. Yet it remains of central importance to us; we are told the system cannot do without it, and it cannot. We can explore the idea that as it fails, inevitably and repeatedly, that debt can no longer provide a means to progress. We could say that its day has come and it has had its day. It would appear an easy argument to win: debt is bad therefore do not enter into it. Would this argument be entered into it would surely prove difficult to disprove. If debt, as it surely does, represents in their language a ‘fault’ of capitalism then let us explore it further. In no time at all it would lead into a cul de sac for it seems in their own words as far as debt is concerned ‘There Is No Alternative’. So what – we might then ask – is on offer?
Damian  McCarthy (by email)


Reply:
It is true that defenders of capitalism get themselves into a glaring contradiction over debt, blaming the crisis on too much debt and then advocating creating more debt to try to get out of it. But a distinction needs to be drawn between the “National Debt” and the personal debts of individual workers. The so-called “national” debt is what the capitalist state owes its creditors, who are mainly other capitalist institutions of one kind or another. As you point out, its size is now being bandied about as an excuse to justify even more austerity for the working class. But this is only an excuse for what they always want to do anyway. If it didn’t exist, they’d find some other excuse. Its size is their problem, not ours. We can, however, use it, as you suggest, to bring out the contradictions of capitalism. If all capitalism has to offer is more austerity in a world of potential plenty, let’s get rid of it.
Editors.

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