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Jacobin - December 23, 2021

Debt is a fact of life — even as it’s proved one of the most persistent problems bedeviling our world. Your home, your consumer goods, your degree, and, if you live in the United States, your medical care — more than likely, all of it was made possible by going into debt. Periodic economic crises have been among the results. Whenever such crises emerge, there have been calls to forgive debt. But the powers that be and an army of commentators warn us any such efforts have to be limited and measured, lest they lead to chaos and disorder. Michael Hudson has a different view. A former economist for Chase Manhattan Bank and advisor to various governments, including Washington, Hudson wrote the highly influential Super Imperialism, explaining how the emergence of an international monetary system based on the dollar in the postwar era ended up helping the US finance limitless military spending. Now a professor of economics at the University of Missouri-Kansas City, Hudson has delved into archaeology to try and find the origins of debt and private property. He spoke to Jacobins Branko Marcetic about the results of this research, the 2018 book …and forgive them their debts: Lending, Foreclosure, and Redemption from Bronze Age Finance to the Jubilee Year. The work covers everything from debt forgiveness in ancient societies to how much of what we know about Christianity is wrong. The conversation has been edited for length and clarity.

You make the case that our modern relationship with and understanding of debt is unique when you look at the full scope of human history. What was ancient societies’ relationship to debt and how did they keep it in check?

Almost all debt, in really ancient society, was interpersonal, what the Europeans called weregild-type debt. If you injured somebody, if you break an arm, or if you kill them, there are two choices ancient society had: either you had a feud, and your family would fight his family, or he’d make restitution, and you would settle the conflict. Gradually, the payment of the weregild, whether it was in money — or if it was really serious, it would be in slave girls or cattle — came to be the word for debt, and for the offense, or the word for “sin.” So the original meaning of the Lord’s Prayer in Hebrew and Greek was, “Forgive us our debts. ”In Mesopotamia, an agrarian economy, most debts began to be owed to the palace or the temples. Obligations were paid throughout the year. In the third millennium Sumer, or second millennium Babylonia, if you go to a bar during the crop year, you’d run up a tab to the alehouse, and to the palace for advances of animals, water, or agricultural inputs, and everything was done by credit. The debts would all be paid on the threshing floor, in grain, and a unit of grain was equal to a unit of silver. But sometimes, you would have a crop failure, or war, or drought, and you couldn’t pay. And at that time, like in the laws of Hammurabi, you’d say, “If the storm god, Hadad, comes and ruins the crops, then the debts don’t have to be paid.” This is how society worked, basically, in the third, second, and even into the first millennium. When a new ruler took the throne, or when there were other reasons — a war was over, or there was any reason for a debt cancellation — you’d cancel the debts, you’d liberate the debt servants to go back to their families, you’d give them back the pledges that they’d made. Because what would happen if you hadn’t wiped out the debts? All of a sudden all these people that owed debts would become the servants of the person who they owed them to, a wealthy person. ...
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