We Can't Grow Our Way Out of Debt

[georgephillip]

In this 9/2012 article, Charles Eisenstein questions why progressives and conservatives alike automatically assume the purpose of economic policy is to stimulate growth.
"So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it. What does economic growth actually mean? It means more consumption – and consumption of a specific kind: more consumption of goods and services that are exchanged for money. That means that if people stop caring for their own children and instead pay for childcare, the economy grows. The same if people stop cooking for themselves and purchase restaurant takeaways instead. So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it..."

"The reason is that our present money system can only function in a growing economy. Money is created as interest-bearing debt: it only comes into being when someone promises to pay back even more of it. Therefore, there is always more debt than there is money. In a growth economy that is not a problem, because new money (and new debt) is constantly lent into existence so that existing debt can be repaid. But when growth slows, good lending opportunities become scarce. Indebtedness rises faster than income, debt service becomes more difficult, bankruptcies and layoffs rise."

http://www.theguardian.com/commentisfree/2012/sep/03/debt-federal-reserve-fixation-on-growth
Eisenstein's solutions include exchanging luxury for leisure and convincing the Fed to incorporate debt forgiveness with quantitative easing.

 

[LoneLaugher]

Of course we can.

 

[Stephanie]

So, give up your luxury of computers for starters. pretty please...

then you can move into grass shacks ( you don't need that luxury called a house) and burn elephant dung for heat . ride a Camel to work (luxury of cars OUT) and dress in fig leaves I guess.
And have this Einstein in charge of telling you what "luxuries" you all can have and not have

sounds like weener to me

 

[Agit8r]

In this 9/2012 article, Charles Eisenstein questions why progressives and conservatives alike automatically assume the purpose of economic policy is to stimulate growth.
"So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it. What does economic growth actually mean? It means more consumption – and consumption of a specific kind: more consumption of goods and services that are exchanged for money. That means that if people stop caring for their own children and instead pay for childcare, the economy grows. The same if people stop cooking for themselves and purchase restaurant takeaways instead. So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it..."

"The reason is that our present money system can only function in a growing economy. Money is created as interest-bearing debt: it only comes into being when someone promises to pay back even more of it. Therefore, there is always more debt than there is money. In a growth economy that is not a problem, because new money (and new debt) is constantly lent into existence so that existing debt can be repaid. But when growth slows, good lending opportunities become scarce. Indebtedness rises faster than income, debt service becomes more difficult, bankruptcies and layoffs rise."

http://www.theguardian.com/commentisfree/2012/sep/03/debt-federal-reserve-fixation-on-growth
Eisenstein's solutions include exchanging luxury for leisure and convincing the Fed to incorporate debt forgiveness with quantitative easing.

Are we talking about National Debt, or private debt?

 

[georgephillip]

"The problem that we are seemingly unable to countenance is the end of growth. Today's system is predicated on the progressive conversion of nature into products, people into consumers, cultures into markets and time into money. We could perhaps extend that growth for a few more years by fracking, deep-sea oil drilling, deforestation, land grabs from indigenous people and so on, but only at a higher and higher cost to future generations.

"Sooner or later – hopefully sooner – we will have to transition towards a steady-state or degrowth economy.

"Does that sound scary?"

We can t grow ourselves out of debt no matter what the Federal Reserve does Charles Eisenstein Comment is free The Guardian

 

[georgephillip]

Are we talking about National Debt, or private debt?

If it's true there is always more debt that money in society, I'm thinking the answer to your question is both???

 

[Toddsterpatriot]

In this 9/2012 article, Charles Eisenstein questions why progressives and conservatives alike automatically assume the purpose of economic policy is to stimulate growth.
"So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it. What does economic growth actually mean? It means more consumption – and consumption of a specific kind: more consumption of goods and services that are exchanged for money. That means that if people stop caring for their own children and instead pay for childcare, the economy grows. The same if people stop cooking for themselves and purchase restaurant takeaways instead. So ubiquitous is the equation of growth with prosperity that few people ever pause to consider it..."

"The reason is that our present money system can only function in a growing economy. Money is created as interest-bearing debt: it only comes into being when someone promises to pay back even more of it. Therefore, there is always more debt than there is money. In a growth economy that is not a problem, because new money (and new debt) is constantly lent into existence so that existing debt can be repaid. But when growth slows, good lending opportunities become scarce. Indebtedness rises faster than income, debt service becomes more difficult, bankruptcies and layoffs rise."

http://www.theguardian.com/commentisfree/2012/sep/03/debt-federal-reserve-fixation-on-growth
Eisenstein's solutions include exchanging luxury for leisure and convincing the Fed to incorporate debt forgiveness with quantitative easing.

Therefore, there is always more debt than there is money.

Alway been this way.
Under a gold standard, under a silver standard, under a fiat system. So what?

 

[georgephillip]

So, give up your luxury of computers for starters. pretty please...

then you can move into grass shacks ( you don't need that luxury called a house) and burn elephant dung for heat . ride a Camel to work (luxury of cars OUT) and dress in fig leaves I guess.
And have this Einstein in charge of telling you what "luxuries" you all can have and not have

sounds like weener to me

 

[georgephillip]

So what?

What?

 

[Agit8r]

Are we talking about National Debt, or private debt?

If it's true there is always more debt that money in society, I'm thinking the answer to your question is both???

Annual GDP and National Debt are roughly equal. Private debt and excessive consumption are problems, but it is a personal choice.

 

[Toddsterpatriot]

So what?

What?

Don't understand banking?
I'm not surprised. Clown

 

[EdwardBaiamonte]

Eisenstein's solutions.

dear, you lack the IQ as a typical liberal to say what the problem is-right?

 

[georgephillip]

So what?

What?

Don't understand banking?
I'm not surprised. Clown

Don't forget to swallow

 

[Toddsterpatriot]

Moron says what?

 

[ScienceRocks]

So hey, let's slash, cut and burn until we're a second world back water country.

Lets slash until our infrastructure is like mexicos!
Lets cut until our science institutions are worse then Pakistans! We don't lead in shit!
Lets burn our educational system to the ground and go be amish!!!!

I'll tell you how we control our debt.
1. Stop nation building the rest of the world
2. Cut welfare. BIG TIME!
3. Reform our healthcare system!

These 3 are most of our debt problem. All cutting infrastructure, science, r&d and education will do is grow our debt as our economy implodes on its self. Also, they have not made the debt...Reagan spent more on them.

 

[ScienceRocks]

Eisenstein's solutions.

dear, you lack the IQ as a typical liberal to say what the problem is-right?

The military, welfare and healthcare. Seems easy enough!!! Of course, you're going to attack 5-6% of our federal budget as you hate the working class in this country.

 

[ScienceRocks]

So what?

What?

Don't understand banking?
I'm not surprised. Clown

Don't forget to swallow

The top 1% profit has grown through the effin roof and all these idiots on this thread want to do is cut their taxes some more. All while cutting the shit out of things that help the low and middle class the most...lol They bitch about people working but they want to do away with of our infrastructure, science, and r&d jobs that the public sector invest in.

 

[georgephillip]

The top 1% profit has grown through the effin roof and all these idiots on this thread want to do is cut their taxes some more. All while cutting the shit out of things that help the low and middle class the most...lol They bitch about people working but they want to do away with of our infrastructure, science, and r&d jobs that the public sector invest in.

They are naturally suspicious of how the transition from a growth dependent economy to a steady state model will affect the fortunes of the 1%.
"Central banks could play a role in this transition.

"For example, what if quantitative easing were combined with debt forgiveness?

"The banks get bailout after bailout – what about the rest of us?

"The Fed could purchase student loans, mortgages or consumer debt and, by fiat, reduce interest rates on those loans to zero, or even reduce principal.

"That would liberate millions from the debt chase, while freeing up purchasing power for those who are truly underconsuming.

We can t grow ourselves out of debt no matter what the Federal Reserve does Charles Eisenstein Comment is free The Guardian

"More radically, central banks should be allowed to breach the 'zero lower bound' that has rendered monetary policy impotent today. If investors are unwilling to lend even when risk-free return on investment is 0%, why not reduce that to -2%, even -5%? Implemented as a liquidity tax on bank reserves, it would allow credit to circulate in the absence of economic growth, forming the monetary foundation of a steady-state economy where leisure and ecological health grow instead of consumption."

 

[CrusaderFrank]

The OP shows why Progressive economies fail 100% of the time and have the highest misery and poverty rates ever recorded in human history

 

[georgephillip]

Private debt and excessive consumption are problems, but it is a personal choice.

I'm not sure the increase in private debt over the past generation has been entirely a matter of personal choice; declining middle class standards of living, brought on by long-term wage stagnation, have made resort to "cheap credit" a necessity for many families.