Debtors' Prison

Debtors' Prison

The Politics of Austerity Versus Possibility

Book - 2013 | 1st ed.
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One of our foremost economic thinkers challenges a cherished tenet of today's financial orthodoxy: that spending less, refusing to forgive debt, and shrinking government--"austerity"--is the solution to a persisting economic crisis like ours or Europe's, now in its fifth year.

Since the collapse of September 2008, the conversation about economic recovery has centered on the question of debt: whether we have too much of it, whose debt to forgive, and how to cut the deficit. These questions dominated the sound bites of the 2012 U.S. presidential election, the fiscal-cliff debates, and the perverse policies of the European Union.

Robert Kuttner makes the most powerful argument to date that these are the wrong questions and that austerity is the wrong answer. Blending economics with historical contrasts of effective debt relief and punitive debt enforcement, he makes clear that universal belt-tightening, as a prescription for recession, defies economic logic. And while the public debt gets most of the attention, it is private debts that crashed the economy and are sandbagging the recovery--mortgages, student loans, consumer borrowing to make up for lagging wages, speculative shortfalls incurred by banks. As Kuttner observes, corporations get to use bankruptcy to walk away from debts. Homeowners and small nations don't. Thus, we need more public borrowing and investment to revive a depressed economy, and more forgiveness and reform of the overhang of past debts.

In making his case, Kuttner uncovers the double standards in the politics of debt, from Robinson Crusoe author Daniel Defoe's campaign for debt forgiveness in the seventeenth century to the two world wars and Bretton Woods. Just as debtors' prisons once prevented individuals from surmounting their debts and resuming productive life, austerity measures shackle, rather than restore, economic growth--as the weight of past debt crushes the economy's future potential. Above all, Kuttner shows how austerity serves only the interest of creditors--the very bankers and financial elites whose actions precipitated the collapse. Lucid, authoritative, provocative--a book that will shape the economic conversation and the search for new solutions.  

Publisher: New York : Alfred A. Knopf, 2013.
Edition: 1st ed.
ISBN: 9780307959805
Branch Call Number: 339.52 KUTTN
Characteristics: 331 p. ; 25 cm.

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JT50
Dec 28, 2014

The idea of government as regulator of economic activity is of course not new. This book provides clear evidence that ideas of the right developed since the 1960's have led to growing inequality, despair and growing incarceration of surplus labour in developed capitalist countries.

It provides a lot detail on the process of global capital and the declining political power of nation states as earlier detailed by Philip Bobbitt's' Terror and Consent.

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StarGladiator
Sep 16, 2014

Although this is somewhat of a good book, Kuttner doesn't appear to grasp the overall design, the underlying agenda, this is simply not a matrix of unintended consequences, after all! One must understand the relationship of globalism to the transnational capitalist class, the connections between TNEC, United States v. Morgan et al. court case, Wright Patman's congressional studies of foundations and trusts, etc. etc., the explosion of offshore finance centers in the 1960s, and 1970s.

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