# Debt **Covers**:: **Source**:: [[Debt by David Graeber]] **Creator**:: [[David Graeber]] # Highlights ##### ^337154879 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=158 ###### ^337154879q the remarkable thing about the statement “one has to pay one’s debts” is that even according to standard economic theory, it isn’t true. A lender is supposed to accept a certain degree of risk. If all loans, no matter how idiotic, were still retrievable—if there were no bankruptcy laws, for instance—the results would be disastrous. What reason would lenders have not to make a stupid loan? ^337154879 ##### ^337154880 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=175 ###### ^337154880q “Surely one has to pay one’s debts.” The reason it’s so powerful is that it’s not actually an economic statement: it’s a moral statement. After all, isn’t paying one’s debts what morality is supposed to be all about? Giving people what is due them. Accepting one’s responsibilities. Fulfilling one’s obligations to others, just as one would expect them to fulfill their obligations to you. What could be a more obvious example of shirking one’s responsibilities than reneging on a promise, or refusing to pay a debt? ^337154880 ##### ^337154881 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=184 ###### ^337154881q it took money to maintain the mosquito eradication program, since there had to be periodic tests to make sure mosquitoes weren’t starting to breed again and spraying campaigns if it was discovered that they were. Not a lot of money. But owing to IMF-imposed austerity programs, the government had to cut the monitoring program. Ten thousand people died. ^337154881 ##### ^337154882 highlight_tags:: [[favorite]] Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=194 ###### ^337154882q If history shows anything, it is that there’s no better way to justify relations founded on violence, to make such relations seem moral, than by reframing them in the language of debt—above all, because it immediately makes it seem that it’s the victim who’s doing something wrong. ^337154882 ##### ^337154883 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=215 ###### ^337154883q Haiti was a nation founded by former plantation slaves who had the temerity not only to rise up in rebellion, amidst grand declarations of universal rights and freedoms, but to defeat Napoleon’s armies sent to return them to bondage. France immediately insisted that the new republic owed it 150 million francs in damages for the expropriated plantations, as well as the expenses of outfitting the failed military expeditions, and all other nations, including the United States, agreed to impose an embargo on the country until it was paid. ^337154883 ##### ^337154884 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=228 ###### ^337154884q In the past, military powers that maintained hundreds of military bases outside their own home territory were ordinarily referred to as “empires,” and empires regularly demanded tribute from subject peoples. The U.S. government, of course, insists that it is not an empire—but one could easily make a case that the only reason it insists on treating these payments as “loans” and not as “tribute” is precisely to deny the reality of what’s going on. ^337154884 ##### ^337154885 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=267 ###### ^337154885q Moses Finley often liked to say, in the ancient world, all revolutionary movements had a single program: “Cancel the debts and redistribute the land.” ^337154885 ##### ^337154907 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=276 ###### ^337154907q If one looks at the history of debt, then, what one discovers first of all is profound moral confusion. ... most everywhere, one finds that the majority of human beings hold simultaneously that (1) paying back money one has borrowed is a simple matter of morality, and (2) anyone in the habit of lending money is evil. ^337154907 ##### ^337154908 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=279 ###### ^337154908q in a region of the eastern Himalayas where as recently as the 1970s, the low-ranking castes—they were referred to as “the vanquished ones,” since they were thought to be descended from a population once conquered by the current landlord caste many centuries before—lived in a situation of permanent debt dependency. ... Often, when a poor man had to borrow money for his daughter’s marriage, the security would be the bride herself. She would be expected to report to the lender’s household after her wedding night, spend a few months there as his concubine, and then, once he grew bored, be sent off to some nearby timber camp, where she would have to spend the next year or two working as a prostitute to pay off her father’s debt. Once accounts were settled, she return to her husband and begin her married life.6 This seems shocking, outrageous even, but Galey does not report any widespread feeling of injustice. ^337154908 ##### ^337154909 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=320 ###### ^337154909q In medieval Europe, ... they would first deny Jews in their territories any means of making a living except by usury (guaranteeing that they would be widely detested), then periodically turn on them, claiming they were detestable creatures, and take the money for themselves. ^337154909 ##### ^337154892 highlight_tags:: [[blue]] Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=369 ###### ^337154892q Here we come to the central question of this book: What, precisely, does it mean to say that our sense of morality and justice is reduced to the language of a business deal? What does it mean when we reduce moral obligations to debts? What changes when the one turns into the other? And how do we speak about them when our language has been so shaped by the market? ^337154892 ##### ^337154893 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=372 ###### ^337154893q A debt is the obligation to pay a certain sum of money. As a result, a debt, unlike any other form of obligation, can be precisely quantified. This allows debts to become simple, cold, and impersonal—which, in turn, allows them to be transferable. ^337154893 ##### ^337154894 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=374 ###### ^337154894q if one owes forty thousand dollars at 12-percent interest, it doesn’t really matter who the creditor is; neither does either of the two parties have to think much about what the other party needs, wants, is capable of doing—as they certainly would if what was owed was a favor, or respect, or gratitude. One does not need to calculate the human effects; one need only calculate principal, balances, penalties, and rates of interest. ^337154894 ##### ^337154910 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=396 ###### ^337154910q September 2008 saw the beginning of a financial crisis that almost brought the world economy screeching to a halt. ... For years, everyone had been hearing of a whole host of new, ultra-sophisticated financial innovations: credit and commodity derivatives, collateralized mortgage obligation derivatives, hybrid securities, debt swaps, and so on. ... They consisted of operations like selling poor families mortgages crafted in such a way as to make eventual default inevitable; taking bets on how long it would take the holders to default; packaging mortgage and bet together and selling them to institutional investors (representing, perhaps, the mortgage-holders’ retirement accounts) claiming that it would make money no matter what happened, and allow said investors to pass such packages around as if they were money; turning over responsibility for paying off the bet to a giant insurance conglomerate that, were it to sink beneath the weight of its resultant debt (which certainly would happen), would then have to be bailed out by taxpayers (as such conglomerates were indeed bailed out). ... the total amount of debt they had run up was larger than the combined Gross Domestic Products of every country in the world—and it threw the world into a tailspin and almost destroyed the system itself. ^337154910 ##### ^337154899 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=466 ###### ^337154899q Credit system, tabs, even expense accounts, all existed long before cash. These things are as old as civilization itself. True, we also find that history tends to move back and forth between periods dominated by bullion—where it’s assumed that gold and silver are money—and periods where money is assumed to be an abstraction, a virtual unit of account. But historically, credit money comes first, and what we are witnessing today is a return of assumptions that would have been considered obvious common sense in, say, the Middle Ages—or even ancient Mesopotamia. ^337154899 ##### ^337154900 highlight_tags:: [[orange]] Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=496 ###### ^337154900q For every subtle and complicated question, there is a perfectly simple and straightforward answer, which is wrong. — H. L. Mencken ^337154900 ##### ^337154901 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=501 ###### ^337154901q Not only is it money that makes debt possible: money and debt appear on the scene at exactly the same time. Some of the very first written documents that have come down to us are Mesopotamian tablets recording credits and debits, rations issued by temples, money owed for rent of temple lands, the value of each precisely specified in grain and silver. ^337154901 ##### ^337154902 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=575 ###### ^337154902q What, he begins, is the basis of economic life, properly speaking? It is “a certain propensity in human nature … the propensity to truck, barter, and exchange one thing for another.” Animals don’t do this. “Nobody,” Smith observes, “ever saw a dog make a fair and deliberate exchange of one bone for another with another dog.”8 But humans, if left to their own devices, will inevitably begin swapping and comparing things. This is just what humans do. Even logic and conversation are really just forms of trading, and as in all things, humans will always try to seek their own best advantage, to seek the greatest profit they can from the exchange. ^337154902 ##### ^337154903 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=653 ###### ^337154903q By mid-century, Lewis Henry Morgan’s descriptions of the Six Nations of the Iroquois, among others, were widely published—and they made clear that the main economic institution among the Iroquois nations were longhouses where most goods were stockpiled and then allocated by women’s councils, and no one ever traded arrowheads for slabs of meat. ^337154903 ##### ^337154904 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=662 ###### ^337154904q Caroline Humphrey, of Cambridge, could not be more definitive in its conclusions: “No example of a barter economy, pure and simple, has ever been described, let alone the emergence from it of money; all available ethnography suggests that there never has been such a thing.” ^337154904 ##### ^337154905 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=744 ###### ^337154905q barter does sometimes occur between people who do not consider each other strangers, but they’re usually people who might as well be strangers—that is, who feel no sense of mutual responsibility or trust, or the desire to develop ongoing relations. ^337154905 ##### ^337154906 Goto: https://readwise.io/to_kindle?action=open&asin=B00Q1HZMCW&location=8255 ###### ^337154906q It’s fascinating to note that the assumption that the notion that exchange is the basis of our mental functions, and manifests itself both in language (as the exchange of words) and economics (as the exchange of material goods) goes back to Smith. Most anthropologists attribute it to Claude Levi-Strauss (1963:296). ^337154906