風蕭蕭_Frank
以文會友
Radhika Desai，the professor at the University of Manitoba
Political Studies
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University of Manitoba
Winnipeg, MB
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(204) 474-9818
Radhika.Desai@umanitoba.ca
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Department of Political Studies
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Phone: 204-474-9733 Fax: 204-474-7585
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https://geopoliticaleconomy.com/author/radhika-desai/
Radhika Desai is a professor in the Department of Political Studies and director of the Geopolitical Economy Research Group at the University of Manitoba. She is the convenor of the International Manifesto Group and the author of several books, most recently "Capitalism, Coronavirus and War: A Geopolitical Economy".
民主和人權的帝國主義 vs 帝國主義的民主和人權
作者：拉迪卡·德賽，2022 年 6 月 8 日
https://doi.org/10.1080/21598282.2022.2065719
自從美國領導人清楚地認識到，他們認為增加與中國的貿易和接觸將導致中國成為西方新自由主義金融化資本主義的蒼白模仿，而中國繼續恪守其社會主義承諾之後，西方對中國的言論就變得強硬起來。在以與特朗普同等甚至更大的力度對中國發動新冷戰時，拜登隻是用帝國主義傳統的虛偽立場取代了特朗普的“美國優先”立場，帝國主義總是假裝為它試圖統治、壓迫、壓迫的世界做好事。利用或以其他方式破壞。該言論的最新版本是關於促進人權和民主。 當美國和西方民主國家正受到不平等、貧困、不信任、社會分裂以及政治不滿和兩極分化等有害因素的攻擊時，當美帝國主義明顯的反民主邊緣變得越來越明顯時，這一立場是 隻是麵臨越來越大的矛盾，本文將探討它們。
The Imperialism of Democracy and Human Rights vs the Democracy and Human Rights of Imperialism
https://www.tandfonline.com/doi/full/10.1080/21598282.2022.2065719?scroll=top&needAccess=true
By Radhika Desai, 8 Jun 2022
https://doi.org/10.1080/21598282.2022.2065719
Western discourse towards China had been hardening since it became clear to US leaders that their assumption that increasing trade and engagement with China would lead it to become a pale imitation of Western neoliberal financialised capitalisms was coming unravelled and China continued to adhere to its socialist commitments. In waging the US’s New Cold War on China with equal if not greater vigour than Trump, Biden merely replaced Trump’s “America First” stance with the traditionally hypocritical stance of imperialism that always pretends to do good for the world it seeks to dominate, oppress, exploit and otherwise destroy. The latest version of this discourse is about promoting human rights and democracy. At a time when US and Western democracies are being assailed by a toxic combination of inequality, poverty, distrust, social division and political disaffection and polarisation, at a time when US imperialism’s distinctly anti-democratic edge is becoming ever more evident, this stance is only facing mounting contradictions. The present article explores them.
債務爆炸：新自由主義如何助長債務危機
https://geopoliticaleconomy.com/2024/01/12/debt-neoliberalism-radhika-desai-michael-hudson/?
政治經濟學家拉迪卡·德賽和邁克爾·哈德森討論了美國和世界各地債務的大規模爆炸，以及新自由主義經濟學如何導致基於投機和資產價格通脹的巨大泡沫。
作者：拉迪卡·德賽和邁克爾·哈德森 2024-01-12
對話 債務新自由主義, 拉迪卡·德賽, 邁克爾·哈德森
政治經濟學家拉迪卡·德賽和邁克爾·哈德森討論了美國和世界各地債務的大規模爆炸，以及新自由主義經濟學如何導致基於投機和資產價格通脹的巨大泡沫。
RADHIKA DESAI：大家好，歡迎來到第 21 屆地緣政治經濟時段，該節目探討了當今時代快速變化的政治和地緣政治經濟。 歡迎來到充滿坎坷的新的一年，所以讓我們幫助它朝正確的方向發展。 我是拉迪卡·德賽。
邁克爾·哈德森：我是邁克爾·哈德森。
RADHIKA DESAI：有句老話說，金錢讓世界運轉。 與許多其他真理一樣，新自由主義也微妙但決定性地改變了這一真理。 新自由主義時代的格言可以說是“債務讓世界運轉”。
事實上，債務不僅讓世界運轉，而且讓世界瘋狂旋轉。 如此瘋狂以至於失控的可能性始終存在。
放眼望去，到處都是債務危機。 有學生債務危機，2008年的抵押貸款危機從未真正消失，有商業房地產危機，有政府債務危機，當然還有住房危機，我指的是信用卡債務、汽車債務等 。
為了保持債務周期持續下去，美聯儲甚至正在改變其長達十年的不容忍通脹的容忍度。 一些報告稱，對於美聯儲來說，3.5%的通脹率是可以接受的。 它寧願容忍3.5%的通脹，也不願犧牲因低利率而持續上漲的資產市場，也不希望利率超過一定水平。
此時加息意味著資產市場更難上漲並維持上漲，這就是為什麽美聯儲無論能否解決通脹問題都會降息。
因此，今天，我們將繼續仔細研究四十多年來的新自由主義政策，以及它們如何通過關注債務、房地產和金融不穩定的三角關係來改變我們的經濟。
簡而言之，我們將討論這幾十年來，雖然收入停滯不前，但債務卻不斷擴大，以至於家庭、政府和企業都負債累累。
如今，其中一份報告顯示，償債本身已增加 50%，目前幾乎占美國政府總支出的六分之一。
住宅和商業地產如何陷入金融化的漩渦是我們要談的另一件事，因為從這種經濟中受益的不是生產者而是食利者，甚至連租金也在被金融化的煉金術所轉化。 變成興趣。
因此，歸根結底，即使是土地所有權和房屋所有權也不再重要。 重要的是你有多少錢以及如何讓你的錢生更多的錢。
最後，我們要討論的是，盡管所有這些都使金融部門受益，但鑒於其本質，金融部門的擴張隻能導致危機，以及今天堆積如山的債務如何威脅到金融部門的穩定。 首先是美國金融部門，然後是美國經濟，正如邁克爾和我多次討論的那樣，還有美元體係本身。
那麽讓我們開始看這張圖表。 這是美國總債務圖表。
欠美國非金融部門債務
所以你在這裏看到，這隻是債務的總體水平。 底部的藍色部分是企業債務，這裏的綠色部分是家庭債務，這裏的紫色部分是聯邦債務，然後在頂部，你有州和地方政府債務，當然人們都知道這些債務受到了限製 通過憲法、法律手段。
所以你這裏所看到的是 20 世紀 60 年代以來的債務，你可以清楚地看到，真正的債務，債務的積累隻有在 20 世紀 80 年代以後的新自由主義時代才開始起飛，而且它真正開始在 20 世紀 80 年代左右開始起飛。 當然，2000 年代，美聯儲首次嚐試了低利率政策，當然，這一政策在 2008 年金融危機後又恢複了。
邁克爾·赫德森：嗯，你可以看看基本的掃描，它是向上掃描，指數增長。 任何債務都是加倍的時間，這種斜率有一些非常獨特的地方。 經濟不是那樣增長的，經濟是在商業中增長的
尼斯循環，向上和向下。
你在這裏看不到的是大幅下滑，這是因為複利導致債務增長繼續增加。 債權人、銀行隻需將他們在發放新貸款中獲得的所有利息進行再投資，這是指數級的，而且他們可以簡單地在自己的計算機上創造自己的貨幣。
所以，這張圖表確實應該與一個經濟周期並列，然後你會發現任何債務增長如此之快都超出了支付能力，這就是過去5000年債務的顯著特征。 債務的自然趨勢是超過償還能力。
現在，這張圖表隻是按擁有債務的部門（家庭部門、企業）顯示債務。 它沒有表明這筆債務的用途。 抵押的目的是什麽？ 嗯，幾乎所有的家庭債務都是房地產債務，商業銀行債務也是如此。 該債務的銀行貸款80%是房地產貸款。
政府債務的藍圖實際上並不那麽重要，因為政府隻是創造了債務。 這是永遠不會償還的債務。 家庭和企業必須償還債務。 這就是導致問題的原因。 沒有人遇到過負債的麻煩。
政府不會遇到債務問題，因為它可以簡單地印鈔票來支付。 但個人、家庭和企業都必須付出代價。 當他們無法付款時，就會損害銀行，銀行就會破產。
美聯儲的目的是確保債務繼續增長，盡管它正在抑製經濟並導致蕭條。
央行的作用是對整個經濟體實施緊縮政策，讓我們在償還債務方麵看起來像第三世界國家，因為這與全球南方國家欠債的清償方式完全相同。 外債以及西方每個國家的債務。
因此，整個西方、歐洲、美國都有一張與此完全相同的圖表，它們都在放緩，而且現在都處於所謂的債務通貨緊縮之中。
RADHIKA DESAI：嗯，你知道，我想補充幾點，因為這張圖表確實比乍一看更有趣。 當然，有你所說的上升趨勢，邁克爾，但還有一個事實是，如果你看一下從 1950 年左右到 1970 年代末的這段時期，就會發現有上升趨勢，但不是那麽明顯。 。
在 1980 年之後的新自由主義時代，特別是在 2000 年左右，你現在看到的是債務真正呈指數級增長的時候。 我認為，正如我所說，這與兩件非常重要的事情是一致的。
第一，《格拉斯-斯蒂格爾法案》的廢除，這意味著這本質上是允許美國金融部門簡單地進行最激烈的相互競爭，以便放貸越來越多，投機越來越多，等等 在。 這就是你所看到的。
當然，另一部分是 2000 年互聯網泡沫破滅後的曆史性決定，當時美聯儲首次開始嚐試低利率。
因此，從 2000 年左右到 2004 年 5 月左右，利率在 1% 到 2% 之間，當時由於美元麵臨很大壓力，美聯儲被迫開始加息。 當然，一係列逐步加息最終刺破了房地產和信貸泡沫。 所以，我的意思是，這是一回事。
第二件事也是美國政府債務。 你知道，在某種程度上你可以說，是的，當然，政府債務不必償還。 但問題是，政府債務並不是不重要。
歸根結底，即使美國政府，或者即使美國政府借了很多錢，它也會遭受損失。 因為今天，美國政府為了從市場借款，必須支付比以前更多的錢來償還債務。
因此，即使在低利率時代，美國政府也比德國等國家支付了更高的溢價和更高的債務利率。
所以從這個意義上說，我認為你在這裏看到的，特別是在新自由主義時代債務增加之後，你在這裏看到的直到2008年的最初增加，基本上是通過向富人減稅而產生的。 因此，盡管社會保障等方麵有所削減，但聯邦赤字還是擴大了。
如今，美國債務的很大一部分實際上是用來支付利率的，即支付美國政府債務的利息。 所以從這個意義上來說，這很重要。
最後，當然，家庭債務的擴張，你會看到它再次增加，在 20 世紀 80 年代略有增加，然後有所放緩，但
你會發現，隨著 2000 年代房地產和信貸泡沫的出現，這一數字尤其增加。
然後它再次減慢，然後再次增加。 當然，這種增長幾乎完全是因為美國家庭遇到了困難。
因此，一方麵，在借貸的頂端，當然，你借錢是為了增加消費，為了以一種或另一種方式花更多的錢，包括為了在股票市場上進行更多的投機。 但另一方麵，你也有很多不良貸款。 這就是我們正在關注的。
最後，企業債務的增加也是因為過去幾十年發生的事情本質上是公司被其他公司收購。
然後，這些公司所做的就是讓他們購買的每家企業承擔盡可能多的債務，以便將這些錢用於其他目的，包括向所有者提供豐厚的股息等等。
但這就是你所看到的。 因此，我們看到的是一個負債累累的世界。
邁克爾·赫德森：嗯，該圖表中也有很多要點。 2000年後，政府債務中有很多是戰爭債務，即伊拉克戰爭債務。 從 1950 年到 1980 年左右，政府債務的增長幾乎全部來自海外軍事支出。
而這筆債務不僅欠美國持有者和美聯儲，還欠外國政府。 所以這沒有包含在圖表中，但這就是增長的大部分。
有趣的是，2008 年之後債務加速增長，但那是零利率政策時期。
美聯儲表示，當奧巴馬崩潰時，我們必須確保的一件事是，家庭首當其衝地承受著這一巨大金融欺詐、不良貸款和垃圾抵押貸款的影響。 我們想拯救銀行，我們想為此犧牲房主。 我們希望讓公眾向銀行付款，以確保房主失去房屋並損失金錢。
企業破產了，但銀行卻因為這些債務而變得越來越富有，而且這些債務不會因為破產而消失。 它會不斷增長，就像學生貸款債務不斷增長一樣。 你會看到很多商業債務在增加，但這些商業債務幾乎是無息的，非常低。
如果我們真的有一組圖表，那麽該圖表應該與之相關的是，所有這些債務都不是用於生產商品和服務，不是用於建造工廠和生產資料，不是用於雇用勞動力，而是用於購買股票和 債券和投機。 這些錢都被用來收購公司，讓它們背上債務。
因此，公司債務的上升是由於兼並和收購、公司突擊搜查、公司收購以及以一種能為股東和私人所有者賺錢而不是為整個經濟賺錢的方式對待公司的結果。 。
所以一家公司會賺錢，假設你接管了西爾斯或玩具反鬥城，私人資本會接管，他們會借錢，幾乎沒有任何利息從銀行，100％，收購西爾斯或其他公司。
他們做的第一件事就是說，好吧，現在我們已經接管了公司，可能是《芝加哥論壇報》，讓我們拿投資股票的養老基金來借錢。 讓養老基金把錢借給公司，讓我們從銀行借更多的錢給公司。 我們借來的錢將向自己支付特別股息。
因此，錢從銀行流向業主，根本不會產生任何積極影響，反而會產生非常負麵的影響。 它讓公司負債累累，以至於破產，就像西爾斯或玩具反鬥城或所有其他基本上已經破產的公司一樣。
當它們破產時，它們就會被賣給越來越大的公司。 因此，這種債務具有將所有權集中在該部門內的效果。
家庭債務增加是因為隨著銀行以住房為抵押貸款的金額增加，銀行開始競爭。 誰可以為想要買房的新家庭提供最多的房屋抵押貸款？
好吧，銀行競相放貸如此之多，以至於如果你是一個買房的家庭，你必須比從銀行借款的競爭對手借更多的錢，而銀行剛剛創造了一個新的房地產泡沫。
這就是我們現在的處境。 房地產價格上漲如此之高，租金價格如此之高，其副產品之一就是無家可歸者的增加。
由於所有這些債務，人們不知何故沒有足夠的錢來購買商品和服務，生活水平也下降了。
由於債務激增，我們生活在第三世界日益緊縮的計劃之中。
拉迪卡·德賽： 不，絕對不。 你知道，你所說的讓我想起我們已經說過，特別貧困家庭借貸的原因之一
是因為他們基本上入不敷出。 他們必須借錢，因此他們負債累累。
但還有另一個原因，那就是，你知道，為什麽新自由主義幾十年來學生債務激增？ 這是因為政府的削減已經停止了對大學的同等程度的資助。 所以費用就上漲了。
當然，學生的生活成本會上升，因為你不能租到任何半體麵的東西，甚至不雅的東西，除非你花很多錢。 因此，所有這些因素都會增加教育成本，這意味著學生必須獲得貸款，等等。
所以本質上是削減社會服務，順便說一句，我們還沒有談論醫療債務。 大量債務的產生是因為人們如果想要支付某些醫療費用就必須借錢。
所以所有這些事情再次表明，在新自由主義下，真正受到傷害的是普通民眾、勞動人民和窮人。
這些人還有另一種被欺騙的方式。 當低利率加劇購房競爭時，最激烈的競爭通常發生在低端市場。
因此，由於低端買家之間的競爭，低端市場，即首次購房者將購買的房屋和房屋，往往會出現最大的價格升值。 這就是讓很多人望而卻步的原因。
但我最後想說的是，這種債務擴張也很有趣，因為它恰好發生在 20 世紀 80 年代初政府承諾限製貨幣供應、承諾美聯儲 限製貨幣供應量以殺死通貨膨脹之龍。
但這本質上意味著人們賺的錢越來越少，但債務卻越來越多。 從本質上講，債務成為向經濟發行貨幣的方式。
當然，美聯儲本身自 1987 年以來一直堅持一項政策，即如果要救助金融部門，無論創造多少貨幣都不算太多。 因此，從1987年開始，當1987年金融危機發生時，格林斯潘首先進行了這種流動性供給，以救助金融部門。 它被稱為“格林斯潘看跌期權”。
現在多年來它已成為美聯儲的看跌期權。 結果是，你知道，我們剛剛向你展示了債務圖表。 根據美聯儲的數據，美國的總債務或非金融債務目前接近美國 GDP 的三倍。 自 1980 年以來已經翻了一番。
還有一點非常有趣。 這些圖表，即我們向您展示的圖表，並不包括美聯儲本身為救助金融部門而創造的巨額債務。 從 2020 年開始，企業部門將成為高端企業，金融部門將依賴企業部門的最佳資產。
因此，本質上，這讓我感到非常驚訝，2008 年，你們大學的一位名叫詹姆斯·福爾克森 (James Fulkerson) 的學者和密蘇裏大學堪薩斯城分校 (UMKC) 的邁克爾 (Michael) 表明，美聯儲無法僅靠 發揮最後貸款人的正常作用，通過提供充足的流動性、大幅降息等方式，將當時的利率從5%降到了0%。 但這並沒有起到穩定係統的作用，甚至使情況變得更糟。
然後，根據福克森的說法，美聯儲采取了一係列非常規措施，無論是規模還是範圍都是史無前例的，而且合法性也值得懷疑。 這是他的話。 這些目標是明確改善市場狀況。 據他介紹，這個計劃總計達29萬億美元。
邁克爾·赫德森：你很快就明白了這一點，我想展示這是多麽的革命性。 從美聯儲成立到 2008 年，中央銀行的基本理念一直可以追溯到英格蘭銀行以及人們在 1880 年代和 1890 年代討論的規則。
關於中央銀行的想法，您使用了“最後貸款人”一詞。 這意味著每個人都意識到，有時當商業不景氣或利率發生變化時，人們會擁有非常健全的財產。 這些建築物在破產時並未被摧毀。 公司沒有被摧毀。
但問題是商業周期出現了暫時的低迷。 因此，銀行應該隻以高利率借貸短期資金。 世界上每個中央銀行都遵循這一政策。 您不補貼銀行信貸利率。
自2008年以來，銀行控製了美國財政部，控製了美聯儲，不勞而獲。 事實上，他們是有償借錢的。
美聯儲表示，2008 年之後，我們必須讓銀行家變得更富有。 盡管事實上他們是
他們支付給自己的錢比任何其他部門都多，但他們沒有足夠的錢繼續放貸。 我們會給他們所有他們想要的錢。 我們這樣做的方式是銀行向企業提供收購貸款，為商業房地產提供貸款。 他們會將這些欠條以存款形式轉入美聯儲。
美聯儲將借錢給他們作為交換。 銀行已將所有不良貸款和不穩定貸款存入美聯儲。 美聯儲向他們支付這些存款的利息。 銀行不是從企業借款人那裏賺取利息，而是美聯儲正在創造利息來支付銀行，以實現貸款的大幅增加。
您可以將其視為大通曼哈頓和花旗銀行的分支機構。 本質上，他們已經控製了美聯儲。
這確實是銀行計劃的中央計劃經濟的自由主義理想。 當自由主義者說，讓我們讓政府破產，讓政府不出現赤字時，這意味著如果政府不出現赤字，它就會減稅，就會削減支出。 這意味著人們需要的、經濟需要的所有信貸都將由銀行提供。
美聯儲已經說過，現在我們要真正加大力度。 我們將讓銀行賺取 5% 的錢。 突然之間，你所看到的這種藍色增長，即政府債務將會飆升。 利率將占他們已經在談論的政府支出的很大一部分，我們將不得不削減社會保障和醫療保險。
共和黨候選人[尼基]黑利就是這麽說的。 共和黨人想說，如果在支付社會保障和醫療保險或向銀行和債券持有人支付利息之間做出選擇，債券持有人是第一位的，因為他們是我們的競選捐助者。 你不會從破產者那裏得到競選捐款人，因為他們沒有銀行那樣的錢。 當然，我們將救助我們的競選貢獻者。
政府本身已經私有化。 這就是新自由主義。 這就是反政府自由主義。 這意味著銀行的自由和廣大民眾的債務體係。 這就是這些圖表的含義。
拉迪卡·德賽：當然。 我隻想說一件事。 當然，大多數人都會知道這一點，但如果人們不知道的話，美聯儲在世界中央銀行中是很奇特的，因為它仍然是私有的。 從這個意義上說，我認為邁克爾所說的非常有意義。
從本質上講，美聯儲在過去幾十年裏所做的就是將美國經濟轉變為這樣一個經濟體：賺錢的主要方式、最好的方式、最快的方式本質上是通過投機，而不是通過投資於經濟。 生產普通人需要的商品和服務，但通過誇大已經生產的商品和服務的價值。
那些對馬克思主義稍有了解的人可能會欣賞它，但如果馬克思在的話，他會稱其為一種非常奇特的死靈術形式。 我這麽說是什麽意思？ 因為已經生產出來的商品和服務包含已經消失的死勞動，它現在已經死了，不再活著，它已經投入到生產中，而你正在誇大其價值。
然而，當你這樣做時，你正在貶低活勞動力的價值，其中大部分可能仍然失業，而所有這些都是生產普通人每年、每個時期都需要的新商品和服務所必需的。
我們需要更多的食物，我們需要更多的衣服，我們需要更多的交通，我們需要更多的住房，等等。而這些都是被扼殺的東西。 活勞動力被扼殺，而死勞動力則上升。 因為有一個非常奇特的東西。
請記住，正如邁克爾所指出的，正如我所指出的，很多債務已經產生。 事實上，其中大部分都是為了投機、誇大現有資產的價值而產生的。 這有一些非常奇特的地方，因為想象一下一套房子的價格上漲了 30%、40%、50%。 它可能沒有任何改變，但價格無論如何都會上漲。 什麽也沒生產，但價格卻上漲。 所以，這就是已經創建的經濟。
我還想向你們展示另一個結果，這就是我這次的最後一點，也是這次大幅增長的另一個結果，即聯邦政府救助金融機構的龐大計劃。
所以，你看，這是美聯儲資產負債表上總資產的圖表。
2024年1月美聯儲資產
你可以看到，從 2000 年代開始，它基本上徘徊在略低於 1 萬億美元的水平。 在 2008 年金融危機中，這一數字翻了一番，實際上翻了一倍多一點，達到了 2 萬億美元以上。
然後在接下來的十年裏，得益於量化寬鬆政策，聯邦政府實質上啟動了一項購買金融機構無價值資產的計劃
金融機構的好錢。 這就是量化寬鬆，因此它不斷增加，增加了自己的資產負債表，同時基本上彌補了造成 2008 年金融危機的金融機構受損的資產負債表。
然後當 2020 年到來時，它開始縮減資產負債表，大流行來了，然後你會看到聯邦政府的資產絕對史無前例地增加到 9 萬億美元。 這是美聯儲斥資 29 萬億美元救助金融業的結果。
所以，邁克爾，請繼續，是的。
邁克爾·赫德森：當你使用“無價值資產”這個詞時，如果你能從美聯儲獲得 100% 的資金，那麽它們並不是完全沒有價值。 從19世紀到今天，馬克思和幾乎所有人都在使用“虛擬資本”這個詞。 換句話說，所有這些債務和銀行資產都算作資產。
如果銀行向辦公樓內的大型企業業主提供貸款，銀行就將其視為資產。 但正如我們今天所看到的，這些資產價格無法實現。 換句話說，如果銀行說，好吧，現在你的抵押貸款即將到期，因為這是一筆大額抵押貸款，你必須支付，該怎麽辦？ 每隔幾年，您就必須全額支付或重新借款。
好吧，突然之間，如果它以辦公樓為抵押貸出 1 億美元，而該辦公樓現在價值 4000 萬美元，那麽銀行為什麽要向價值 4000 萬美元的辦公樓的業主貸出 1 億美元呢？ 這就是我們今天的處境。
現在，看看這兩個跳躍。 2008 年之後的第一次跳躍是垃圾抵押貸款的跳躍。 所有這些貸款都是針對虛構的抵押貸款，這些抵押貸款假裝有價值，但銀行主要向黑人和西班牙裔借款人發放抵押貸款，銀行欺騙了他們，高估了價格。
大約在 2004 年之後，銀行普遍發現了一種新的賺錢方式。他們可以通過向少數族裔收取更高的利率來賺錢，幾乎是向白人收取的利率的兩倍。 有很多銀行和經紀人專門從事這方麵的工作，這基本上就是垃圾抵押貸款集團。 從全國範圍來看，金融業是最明顯的受益者。
有許多臭名昭著的銀行最終被合並。 美國銀行是不誠實的銀行之一。 花旗銀行是最不誠實的銀行之一，這一點已有充分記錄。
利維研究所和堪薩斯城的蘭德爾·雷 (Randall Wray) 發表了一篇重要的解釋，解釋了這些 29 萬億美元、27 萬億美元的貸款是誰的。 最終，其中許多貸款被展期並重新放貸，因此淨額不是 27 萬億美元，但這就是這次大幅躍升後向銀行提供的金額。 他們沒有把銀行家送進監獄，而是讓他們成為億萬富翁。 他們獎勵了他們。
這就是奧巴馬的政策，也正是這一政策使他們成為美國現代曆史上最惡毒的種族主義總統之一。 民主黨致力於恢複內戰前的種族主義政策。
好吧，下一組是您在 2020-21 年看到的銀行貸款大幅增長。 他們來自哪裏？ 美聯儲開始加息。 當美聯儲將利率從不足1%提高到5%時，這意味著債務人突然要支付以前10倍的利息。
這樣做的作用是降低了資產的價格。 它與利率成反比。 突然之間，倒閉的銀行持有的股票和債券都是虛構的。
事實上，盡管矽穀銀行和紐約銀行倒閉了，但所有銀行，尤其是花旗銀行和大通曼哈頓銀行，都擁有了所有的貸款。 突然之間，它們的價值根本不及賬麵上的價值。 銀行資不抵債。
現在，這是一個絕佳的機會。 美聯儲本可以讓政府接管它們，然後說，你們無力償債。 我們將消滅股東和債券持有人，因為你們發放了不良貸款。 相反，美聯儲表示，與其讓銀行破產，不如讓經濟破產。
這就是我們今天的政策。 美聯儲貸款的增加是為了支持信貸的增加，從而增加了負擔。 所有這些信貸增長遠遠超過了人們獲得的工資和薪水。
不知何故，利息費用、攤銷費用和罰款的增加最終導致食品、服裝和其他消費支出減少，導致經濟陷入貧困。 如果消費者支出增加，那是因為通貨膨脹。
拉迪卡·德賽： 一個小小的更正。 當然，這一大幅增長是因為美聯儲在疫情爆發時啟動了一項新的大規模流動性供應計劃，即量化寬鬆計劃。 而你所說的那個， esse
最初他們救助矽穀銀行等，這是這裏的小幅增長，這是利率開始上升後發生的情況。 但在此期間，直到此時為止，利率仍處於曆史低位。
在我們結束這次談話之前，我還想說一件事，那就是，你知道，在 2013 年左右，基本上，美聯儲決定嚐試縮小其資產負債表的規模 。
所以你可以看到，當時仍然隻有大約三萬億美元，而不是今天的九萬億美元。 但你知道金融機構和金融部門做了什麽嗎？ 2013年，當時的金融業爆發了“縮減恐慌”。
你知道，美聯儲威脅要縮減資產負債表，本質上是為了減少資產負債表。 他們說，我們沒有。 你必須繼續支持我們，你必須購買我們的資產。 因此，本質上，美聯儲遷就了他們的脾氣，他們繼續擴大資產負債表。 然後，正如我們在大流行中看到的那樣，做得更多，等等。這就是我們正在關注的事情。
當然，我想指出的另一件事是，你知道，我完全同意邁克爾所說的關於這個製度有多麽種族主義的一切，因為歸根結底，你知道，人們認為 債務是一種市場關係。
債務不是市場關係。 總體而言，這是一種相對享有特權的人之間的關係，其中一個人決定借錢給另一個人。 因此，通過一項立法，你可以讓美國的窮人、美國的黑人、美國的西班牙裔成為房主，這種想法總是有點問題。
最終，在整個 2008 年金融危機中，之前的債務大量增加，隻有一小部分（發生在債務大幅增加的最後階段）實際上是向次級借款人提供的貸款。 金融機構隻有在向優質借款人提供了他們可以承擔的所有債務後才開始向次級借款人提供貸款，然後他們才會采取行動。
因此，從很多方麵來說，次貸借款人都是最後的，當然，他們也是受害最深的人。 所以，是的，我的意思是，我認為我們確實生活在一個充滿債務的經濟中，正如我們剛才所說，這確實與我們應該擁有的經濟背道而馳。
邁克爾，你知道，關於土地、租金和利息等整個古典概念的一件事當然是，古典政治經濟學總是瞧不起這樣的東西，比如利息和租金，因為它看到了它 作為非勞動收入，不是嗎？
邁克爾·赫德森：嗯，我可以花一小時的時間來討論這個問題，但我想跟進一些有關種族因素的圖表。 我們已經討論了債務量太大而無法償還，但我想說債務還有另一個方麵，如果你能顯示種族，那就對了，那個圖表非常有趣。
美國房屋擁有率競賽
債務的結果之一是創造了一個分裂的經濟，這意味著我們處於一種種族隔離的經濟之中。 我們處於金融種族隔離經濟中。 10%的人口擁有人口中75%以上的股票和債券，而且他們幾乎全部是白人。
我們已經討論過抵押貸款債務占總債務負擔的 80%。 我想展示 2002 年圖表開始之前很久發生的事情。
我想從 1945 年二戰結束時開始。 那確實是在大蕭條時期房屋還沒有建造的時候，因為人們沒有市場。 它們不是在第二次世界大戰期間建造的，因為所有原材料都用於戰爭，而且 1945 年整個經濟的債務非常非常低，因為沒有什麽可以借錢的。 你不能借錢消費，因為無論如何一切都是配給的。
但最後，他們開始發放貸款，這刺激了美國和其他國家的騰飛。 歐洲、美洲和其他國家都在戰後重建，其中大部分重建是住房重建。 那是偉大的住房建設的時候。 在皇後區，有主要的開發商，不僅是特朗普的父親，而且所有著名的實驗和集體住房都是在這裏進行的。
隻有一件事。 白人能夠以大約 10,000 美元的價格購買房屋，這是現在價值 100 萬美元的房屋的典型價格。 問題是，為了買房子，銀行隻會讓你申請抵押貸款。 沒有人有足夠的錢來購買一棟房子的全部價值，如果 1945 年的工資可能是 3,000 或 4,000 美元，你甚至買不起 10,000 美元的房子。 沒有人有這樣的經曆。 你必須去銀行。 銀行，直到 2000 年、2001 年左右，隻會
抵押貸款幾乎全部向白人發放，除非你是一個非常非常富有的黑人或西班牙裔。
你創造的是一個分裂的社會。 1945年買房的人——他們從戰爭中歸來。 他們從事民事工作。 他們買了房子，很多人都老死了，卻把房子留給了孩子們。
一代又一代的白人把房子留給孩子們，給他們留下足夠的遺產，讓他們擁有自己的房子和自己的教育。 所以你擁有的是一個擁有房屋、受過教育的白人階層，但這個國家的非白人無法享受到這一點。
那麽，對主要人類而非未成熟借款人的信貸限製有多深？ 我們正在談論一項相當種族主義的政策。 這是非常重要的一個事實，即現在已經有 75 年了——嗯，比這更長，自二戰以來的 75 年——在美國，有一個被剝奪權利的非白人階層，他們的世襲房主可以進入大學 因為他們的父母和祖父母都上過常春藤盟校。
經濟金字塔的頂端存在對住房、教育和財富的壟斷，而經濟的其他部分基本上被剝奪了權利，就好像我們處於我們自己的金融化種族隔離經濟中一樣。
RADHIKA DESAI：是的，還有其他幾點。 順便說一句，在這張圖表中，我應該解釋一下，這裏的第一行本質上顯示的是美國非西班牙裔白人的住房擁有率，約為 75%。
底部的紅線代表美國的黑人，綠線代表美國任何種族的西班牙裔。 因此，這大概包括，例如，如果你是一個相對白人的西班牙裔，他們會做得更好一些。
但你可以看到，從2000年代初到現在，黑人的擁有率確實沒有變化。 如果說有什麽不同的話，那就是今天的情況比以前稍微糟糕一些，而且在大流行之前變得更加糟糕，實際上達到了 40% 左右的非常低的水平。 無論如何，事情就是這樣。
但除了這些東西之外，我們生活的那種金融化經濟，越來越多地擁有房子和土地等等，並不一定，因為抵押貸款，擁有土地或房子並不一定會給你帶來任何特權， 因為房主發現他們正在向銀行支付利息，甚至房東的杠杆率通常也很高，因此他們收取的大部分租金實際上最終都變成了銀行的利息。
因此，從某種意義上說，我們想說的是，美聯儲設計了一種經濟，在這種經濟中，不僅利潤和工資基本上成為支付利息的對象，而且租金也被用來支付利息。 因此，可以說，利息已經成為收入金字塔頂端的主要收入形式。
這也是稅收結構變化的結果。 例如，在美國的稅收製度中，利息和租金收入的待遇比我們的工作收入要寬鬆得多，優惠得多。 這是一個很大的問題。
邁克爾·赫德森：這又回到了價值理論，我認為需要單獨進行討論，因為它是如此基礎。
古典經濟學和自由市場的整體理念是一個免於租金的市場，租金是非勞動收入。 房租是房東在睡覺時賺的錢。
地租不是勞動創造的，大多數人沒有意識到什麽是建立在李嘉圖和馬克思以及整個19世紀基礎上的所謂勞動價值論。
這個想法是將勞動創造的價值與經濟租金分開，經濟租金是由世襲、特權、財產所有權、所有者、銀行、壟斷者以及賺錢的地主創造的。 ，通過擁有出租財產，或通過借貸並賺取利息，或通過擁有公司，壟斷。
你隻需提高價格，而大部分通脹，正如拉迪卡在演講開始時提到的那樣，他們稱之為利潤通脹，這意味著一家公司決定，讓我們提高藥品價格。
例如，我的妻子參加了雇主聯合醫療保健計劃。 她要支付的價格，當地藥店在1月1日漲了五倍，因為醫療保險公司說，我們可以通過價格翻五倍來賺錢。
製藥公司一直在全麵提高價格，不是因為生產更多，也不是因為成本上升，最終成本將是生產、勞動力和材料成本，而僅僅是因為它們“ 已經成為壟斷者。
民主黨一直是壟斷企業的偉大保護者，因為他們是競選貢獻者。 如果你看看誰是衛生委員會的領導者和國會的其他人，國會的相關委員會，他們的攝像頭
Paign 貢獻者來自製藥和製藥行業。
因此，政府代表其競選捐助者，參議院和眾議院的軍事和國務院部門由軍工聯合體、製藥公司的衛生部門等提供補貼和支付費用。
因此，我們是導致美國經濟失敗的問題的一部分。 由於債務種族隔離造成的緊縮政策，這是一個失敗的經濟。
RADHIKA DESAI：我們可能應該很快轉向討論解決方案。 但讓我對你所說的內容補充一點，當然，如果你看看今天的美國經濟，你會發現在新自由主義時期，所發生的情況是它已經成為主導， 當然是金融領域，也就是所謂的FIRE領域，金融、保險、房地產。
最重要的是，如果你看看美國經濟的其他哪些部門非常重要且利潤豐厚，你會發現它們是軍工綜合體，它們是大型製藥公司，它們是信息和通信 技術。
在幾乎所有這些情況下，這些部門的特點是高度壟斷、高度尋租，例如，軍事工業綜合體基本上依賴於大量的政府合同，而這些合同是有風險的—— 免費，他們可以隨意增加成本。
大型製藥公司以及信息和通信技術公司依靠知識產權來確保其壟斷地位。
因此，從所有這些方麵來看，這創造了一個非常缺乏活力、效率不高的經濟，但與此同時，對於擁有它的人來說卻非常有利可圖，這當然給普通美國人帶來了額外的負擔。
邁克爾·赫德森：嗯，缺乏活力的問題之一是辦公空間和商業地產的減少。 我們一直在談論住房擁有率以及這是多麽不公平，但你還記得 2008 年房地產價格暴跌時，你收到了所謂的“叮當郵件”。
你會有買家，特別是在內華達州和佛羅裏達州，那裏的房價大幅上漲，他們會說，好吧，我欠這棟房子 50 萬美元，但現在隔壁的房子售價 30 萬美元 。 我會把鑰匙寄回銀行，然後說，好吧，我違約了，你可以擁有房子，我隻是不會付款，我要申請新的貸款並買房子 隔壁。
嗯，這種現象現在正在企業中發生。 顯然，[僅] 40% 的美國商業地產已被占用。 換句話說，自從新冠疫情以來，最重要的是，自從經濟因債務通貨緊縮而開始萎縮以來，企業一直在倒閉。
即使是那些經商的人，也有人在家工作。 現在，如果建築物的平均入住率隻有40%，業主怎麽有錢向銀行付款呢？
嗯，因為銀行幾乎將建築物價值的 100% 借給了願意支付所有租金作為利息的房主，所以租金是為了支付利息，這是基本的座右銘。
他們想要的是建築物價格中的資本收益。 他們意識到他們不會獲得資本收益。 這都是虛構的資本，它正在下降，我們將鑰匙寄回銀行，然後離開大樓。
今年和明年，不僅在英國，而且在英國和其他國家，都有數萬億美元的商業房地產到期，銀行突然之間就會出現未償還的抵押貸款。
針對這些抵押貸款，他們對儲戶、債券持有人負有負債，最重要的是，他們想向大通曼哈頓銀行的負責人傑米·戴蒙（Jamie Dimon）支付數百萬美元，每年因經營一家公司而獲得 2900 萬美元 該公司已經破產，但卻得以維持，因為他將這 2900 萬美元中的一部分交給了繼續任命美聯儲人員來救助他們的政客。 這就是所謂的循環流。
當銀行突然破產時你會做什麽？ 嗯，通常情況下，如果他們發放了不良貸款，就必須有人受苦。 誰會受苦？
正如比爾·克林頓（Bill Clinton）在被告知必須按照艾倫·格林斯潘（Alan Greenspan）所說的去做並支持銀行時所說的那樣，克林頓說，哦，一切都與債券持有人有關。
2009年，當奧巴馬上任並決定救助銀行時，聯邦存款保險公司負責人希拉·貝爾(Sheila Bair)表示，等一下，我們有一家不誠實、無能的銀行。 美國有一家銀行比其他銀行更狡詐、更無能。 那是第一國民城市銀行。 讓我們接管它。 讓我們把它變成一家公共銀行。 你不能讓這家銀行因為過於貪婪而放出過多的貸款而摧毀整個經濟
財產的價值，並一直期望得到救助，這樣它就可以賺取更多的利息並支付給管理人員更多的錢。 讓我們把它開到下麵吧。
奧巴馬和他的財政部長蒂姆·蓋特納表示，這一切都與擁有銀行的債券持有人有關。
那麽問題是，當所有這些抵押貸款都破產時，銀行會做什麽？ 好吧，消滅股東。
但債券持有人是人口中最富有的 1%。 他們擁有大部分銀行債券。
您認為政府會支持誰？ 它會支持經濟、股東還是1%？
這確實是你應該考慮一個經濟體是種族隔離經濟體的方式，不僅僅是在種族和種族上，而且在經濟上。 這就是債權人和債務人之間真正的種族隔離，我認為我們所有的節目都從不同的角度審視這一點。
拉迪卡·德賽：邁克爾，我想對你所說的內容補充幾點。 這非常有趣，因為如果你看看商業房地產，毫無疑問，過去幾個月一直有關於商業房地產價格暴跌的頭條新聞。 它來了。 事實上，這已經發生了。
正如邁克爾所說，從我們在財經媒體上讀到的情況來看，商業房地產的價值已經在持續下跌。 真正的大威望建築可能不會受到影響，但下一層以下，所有這些建築都會受到影響。
每個走過北美大城市或歐洲其他地方的大城市的人都會發現商業空間基本上正在下降。 這麽多人都被封起來了 這麽多都是空的等等。
根據一項衡量標準，美國銀行大約10%的資產實際上依賴於商業房地產的價值。 現在，邁克爾問道，你知道，當危機來臨時，危機已經來了。
那麽美聯儲要幫助誰呢？ 但你知道嗎，我什至不確定。 而美國政府，他們要幫助誰？ 美國當局要幫助誰？
我什至不確定他們是否能夠幫助他們，因為事實是，隨著這些資產的價值下降，如果它們持續公開上市，銀行就必須報告它們，這意味著它們的股票 已經會下降了。
毫無疑問，崩潰將會到來。 當它到來時，是的，美聯儲將再次，正如你在矽穀銀行看到的那樣，本質上，事實上，我想在那裏指出另一點。 本質上，[珍妮特]耶倫女士站出來表示，我們將為所有儲戶提供擔保，即使他們的存款高於 25 萬美元。
現在，您可能會認為這在某種程度上是一件非常民主的事情。 但相反，如果你看看矽穀銀行是一家什麽樣的銀行，本質上它就像一個俱樂部，其中一群精選的富人彼此都有聯係，互相借出大量資金。
那麽，貸款是什麽意思呢？ 這意味著我去找我的朋友，還有矽穀銀行，說，請給我 500 萬美元。 我要創業。 你根本不考慮我的創業公司是否值得支持。 你隻要說，好吧，我給你，我要在你的賬戶上顯示500萬美元的存款。 這些是耶倫女士所保護的存款。
這甚至還不是他們存入銀行的錢。 這是以我的名義存入的存款，因為它是借給我的。
因此，如果你想一想保護極少數富人的利益有多大，我希望在這個節目中我們能讓你了解美國當局為保護極少數人的利益而采取的措施。 這個少數人的財富。
在我們的下一個節目中，也許我們會做的是，我們將完全致力於討論如果我們要擺脫這種經濟，需要發生什麽。
邁克爾·赫德森：這是結束這一切的好方法。 它會導致很多事情。 美聯儲最不想看到的就是——如果銀行報告其資產的實際市場價值怎麽辦？
當你有資產負債表、資產和負債時，他們以貸款的價格持有資產，比如一棟大樓的 1 億美元。 但如果他們報告的大樓資產僅為 4000 萬美元呢？ 你在這裏有銀行資產，在這裏有負債。 他們看起來就像大多數美國人一樣。
50%的美國人沒有任何資產，但卻背負著巨額債務。 這是一個有趣的條形圖，可以顯示資產和負債。 你可以按收入群體來查看。
美聯儲沒有提供關於債務占收入比例的可信統計數據。
如果你看看美聯儲按百分位數（10%、20%）計算的債務與收入的統計數據，就會發現過去 50 年沒有任何變化。 根本沒有人負債。 因為他們說，讓我們假設最後半美分的債務保持不變
烏裏。 統計數字是虛構的。
它們是虛構的，因為這保護了這樣一個事實：大部分所謂的銀行資本都是虛構的。 我的意思是，我們處於一個虛擬的經濟中。
這有點像試圖在《紐約時報》上閱讀有關國際事務的文章。 這與美聯儲的統計數據一樣現實。
拉迪卡·德賽：沒錯。 我的意思是，基本上美國的富人和美國的大型金融機構都處於這樣的境地：他們做了糟糕的投資，他們虧損了，然後他們就走了，哎呀。
然後美聯儲，也就是他們的糖爹，基本上就會來彌補他們的所有損失。 它給了他們更多的錢來填補資產負債表上的漏洞，這些漏洞是他們自己因貪婪、誤判和錯誤判斷而造成的。
因此，我們有它。 不幸的是，美國今天所麵臨的正是這種經濟。 那麽問題自然而然地出現了，美國人需要什麽樣的經濟來取代它？
邁克爾·赫德森： 我想補充一點。 重要的是，這些不償還債務的富人不必支付罰金。 欠債的大商人不支付罰金。
您知道，如果您是一個家庭並且背負著信用卡債務，如果您錯過了電費賬單或任何其他地方的付款，您的利率會從 19% 上升到 30% 或更多。
如果你是富人，情況就不是這樣了。 有一套利率和罰款適用於 99% 的人口，另一套適用於最富有的 1% 到 10% 的人口，而你不在其中。
拉迪卡·德賽：這就是我們所說的金融種族隔離。 所以我想，邁克爾和我將告別，並希望在幾周後見到你，我們將討論我們需要什麽樣的經濟。
非常感謝您加入我們，幾周後再見。 再見。
The debt explosion: How neoliberalism fuels debt crises
https://geopoliticaleconomy.com/2024/01/12/debt-neoliberalism-radhika-desai-michael-hudson/?
Political economists Radhika Desai and Michael Hudson discuss the massive explosion of debt in the US and around the world, and how neoliberal economics leads to large bubbles based on speculation and asset-price inflation.
By 
Transcript
RADHIKA DESAI: Hello and welcome to the 21st Geopolitical Economy Hour, the show that examines the fast-changing political and geopolitical economy of our time. Welcome also to a new year that promises to be nothing but rocky, so let’s help rock it in the right direction. I’m Radhika Desai.
MICHAEL HUDSON: And I’m Michael Hudson.
RADHIKA DESAI: There’s an old saying, money makes the world go around. Like so many other truths, neoliberalism has subtly but decisively altered this one too. The adage of the neoliberal age can be said to be “debt makes the world go around”.
Indeed, debt is not just making the world go around, it is making it spin madly. So madly that the possibility that it will spin out of control is ever present.
Everywhere you look, there’s a debt crisis. There’s a student debt crisis, the mortgage crisis of 2008 never really went away, there’s the commercial real estate crisis, there’s a government debt crisis, and of course, there is the crisis of housing, I mean credit card debt, auto debt, etc.
To keep the debt cycle going, the Federal Reserve is even changing its decade-long tolerance of intolerance of inflation. For the Federal Reserve, inflation is acceptable at 3.5%, according to some reports. It would rather tolerate 3.5% inflation than sacrifice the asset markets that keep going up thanks to which have kept going up thanks to low interest rates, and it doesn’t want to take interest rates beyond a certain level.
Raising interest rates at this point means making it harder for asset markets to go up and stay up, and that’s why the Federal Reserve is going to cut interest rates no matter whether it’s managed to solve the inflation problem or not.
So today, we are going to continue our closer look at more than four decades of neoliberal policy and how they’ve changed our economy by focusing on the triangle of debt, real estate, and financial instability.
In short, we are going to talk about how in these decades while incomes have stagnated, debt has expanded such that households, governments, and businesses have all become indebted to the gills.
Today, one of the reports shows that debt servicing itself has gone up by 50% and today accounts for almost a sixth of total government spending in the United States.
How both residential and commercial real estate have become bound up in the vortex of financialization is another thing we want to talk about because it is not producers but rentiers who benefit from this type of economy, and even rent is being converted by the alchemy of financialization into interest.
So at the end of the day, even land ownership and home ownership no longer matter. What matters is how much money you’ve got and how you can make your money make more money.
So finally, we are going to talk about how even though all of this has benefited the financial sector, given its very nature, the expansion of the financial sector can only lead to crisis, and so how the mountain of debt today threatens the stability of the US financial sector and by turn of the US economy, and as Michael and I have discussed so many times, the dollar system itself.
So let’s start looking at this chart. This is the chart of total indebtedness in the United States.
So you see here, this is simply the aggregate level of indebtedness. The kind of blue bits at the bottom are business debt, this green bit here is household debt, this purple bit here is federal debt, and then on top, you have state and local government debt which of course as people will know has been restricted by constitutional, by legal means.
So what you have here is debt from the 1960s onwards, and you can see clearly that really the debt, the accumulation of debt begins to take off only out in the neoliberal era from the 1980s onwards, and it really begins to take off around the 2000s when of course the United States Federal Reserve first experimented with low-interest policies, and of course, which then resumed after the 2008 financial crisis.
MICHAEL HUDSON: Well, you can look at the basic sweep which is an up sweep, an exponential growth. Any debt is a doubling time, and there’s something very unique about this kind of slope. The economy doesn’t grow like that, the economy grows in business cycles, up and down.
What you don’t see here is very much of a downswing, and that is because the growth of debt continues to mount up by compound interest. The creditors, the banks, simply reinvest all of the interest that they get in making new loans, which is exponential, and they can create their own money simply on their own computers.
So, this chart really should be juxtaposed with one of the business cycles, then you’ll see that any debt that grows this rapidly exceeds the ability to be paid, and that is the distinguishing feature of debt for the last 5,000 years. The natural tendency of debt is to exceed the ability to be paid.
Now, this chart simply shows debt by the sector that owns it, the household sector, business. What it does not indicate is what this debt is for. What is it collateralized for? Well, almost all of the household debt is for real estate, and the same thing with commercial bank debt. 80% of bank loans for this debt are real estate loans.
And the blue chart of government debt really doesn’t matter that much because the government simply creates the debt. And it’s debt that doesn’t ever expect to be repaid. Households and businesses have to pay the debt. That’s what’s causing the problem. Nobody ever got into trouble running into debt.
The government doesn’t run into trouble running into debt because it can simply print the money to pay. But individuals, families, and corporations have to pay. And when they can’t pay, that hurts the banks, and the banks go under.
And the purpose of the Federal Reserve is to make sure that this debt keeps on growing despite the fact that it is stifling the economy and leading to depression.
The role of the central bank is to impose austerity on the whole rest of the economy to make us look like a Third World country in paying the debt, because this is exactly the same kind of sweep that you have for the global south countries owing their foreign debt and for every country in the west.
So the whole West, Europe, the United States, has a chart just exactly like this, and they’re all slowing down, and they’re all in what’s called a debt deflation right now.
RADHIKA DESAI: Well, you know, I’d just like to add a few more points because this chart is really kind of more interesting than might appear at first sight. Of course, there is the upsweep that you talk about, Michael, but there is also the fact that if you look at the period from essentially from about 1950 till the end of the 1970s, there is an upsweep, but it is not so pronounced.
What you see now in the neoliberal era after 1980, and particularly after about 2000, that’s when you see the really exponential increase in debt. And I think that that, as I say, coincides with two very important things.
Number one, the repeal of the Glass-Steagall Act, which meant that this was essentially permission for the U.S. financial sector to simply enter into the most breakneck competition with one another in order to lend more and more, speculate more and more, and so on. So that’s what you’re looking at.
And of course, the other part is the historic decision after the 2000 crash, the dot-com bubble crash, when the Federal Reserve first began experimenting with low interest rates.
So you had sort of one, between one and two percent interest rates from about 2000 till about 2004-5, when because the dollar was coming under a lot of pressure, the Federal Reserve was forced to start raising interest rates. And that graduated series of interest rate increases was, of course, what eventually pricked the housing and credit bubble. So, I mean, that’s one thing.
The second thing as well is that United States government debt as well. You know, at one level you can say that, yeah, sure, the government debt doesn’t have to be paid off. But the thing is, it’s not as though the government debt does not matter.
At the end of the day, even when the U.S. government, or when even the U.S. government borrows a lot, it does suffer. Because today, the U.S. government is having to pay much more money in return for its debt in order to borrow from the market than it used to have to.
So, and even in the era of low interest rates, U.S. government paid a higher premium, higher interest rates on its debt than, say, a country like Germany, for example.
So in that sense, I think that what you see here, which is particularly after the increase in the debt in the neoliberal era, this initial increase here you see up to 2008, is basically created out of essentially giving tax cuts to rich people. So that expanded the federal deficit, even though you had cutbacks in Social Security and so on.
And today, a very large part of U.S. debt is actually going to paying interest rates, paying interest on U.S. government debt. So in that sense, it’s important.
And then finally, of course, the expansion of household debt, which again, you see it increases, it increased a little bit in the 1980s, then it sort of slowed, but then you see it particularly increasing in the 2000s with the housing and credit bubble.
Then it slows again, and then once again, it is increasing. And this increase, of course, is almost entirely because of the difficulties in which U.S. households find themselves.
So on the one hand, at the top end of the borrowing, of course, you have borrowing in order to consume more, in order to spend more in one or the other way, including in order to speculate more in stock markets. But on the other hand, you also have a lot of distressed borrowing. So this is what we are looking at.
And finally, this increase in business debt is also because essentially what has been happening over the last several decades is that companies are bought by other companies.
And then what these companies do is they burden every business they buy with as much debt as they can get in order to essentially use the money for other purposes, including giving fat dividends to owners and so on.
But this is what you’re looking at. So we’re looking at a highly, highly indebted world.
MICHAEL HUDSON: Well, there are a number of points also in that chart. After 2000, a lot of that government debt was the war debt, the Iraq War debt. From 1950 through about 1980, almost all the growth in government debt was military spending abroad.
And this debt is not only owed to the United States holders and the Federal Reserve, but the foreign government. So that is not included in the chart, but that’s much of the growth.
The interesting thing also is that you see this acceleration of debt after 2008, and yet that was the period of zero interest rate policy.
When the Obama crash occurred, the Federal Reserve said, the one thing we have to make sure is that families bear the brunt of this enormous financial fraud and bad lending and junk mortgages that have taken place. We want to save the banks and we want to sacrifice homeowners for it. We want to make the public pay to the banks to make sure that homeowners lose their home and lose money.
Businesses go bankrupt, but the banks continue to get richer and richer with this debt, and this debt will not get wiped out by bankruptcy. It’s going to grow and grow, just like student loan debt has grown. And you see a lot of this business debt going up, and yet this business debt was almost interest free, very low.
What the chart should be correlated with, if we really had a group of charts, was all of this debt was spent not on producing goods and services, not in building factories and means of production, not in employing labor, but in buying stocks and bonds and speculating. It was all used to buy companies, load them down with debt.
And so this corporate debt that’s going up is a result of the mergers and acquisitions, the corporate raids, the corporate takeovers, and treating corporations in a way that would make money for their stockholders and their private owners, but not for the economy at large.
So a company would make money, suppose you take over Sears or Toys R Us, the private capital that would take over, they would borrow the money, hardly any interest from a bank, 100%, buy out Sears or another company.
The first thing they’d do is say, okay, now we’ve taken over the company, could be the Chicago Tribune, let’s take the pension funds that’s invested in stocks and let’s borrow against that. Let’s let the pension funds lend the money to the company, and let’s borrow more money from the banks to the company. And the money that we borrow, we will then pay out a special dividend to ourselves.
So the money goes from the banks to the owners without having any positive effect at all, but having a very negative effect. It leaves the company so deeply in debt that it goes bankrupt, like Sears or Toys R Us or all of the other companies that have been essentially going bankrupt.
And when they go bankrupt, they’re sold to larger and larger companies. And so this debt has the effect of concentrating ownership within the sector.
And the household debt has gone up because as you increase the amount of money that banks will lend against housing, banks have competed. Who can lend the most money against homes for new families wanting to buy a home?
Well, the banks compete to lend so much money that if you’re a family buying a home, you have to borrow more money than your rival who’s borrowing from their bank, and the banks have just created a new real estate bubble.
And that’s what we’re in now. The real estate prices have gone up so high, the rental price is so high that one of the byproducts of this is a rise in homelessness.
And with all of this debt, somehow people don’t have enough money to buy goods and services, and standards of living have gone down.
We’re living in a increasing Third World austerity plan as a result of this upsweep in debt.
RADHIKA DESAI: No, absolutely. And you know, what you say reminds me that we’ve already said that one of the reasons why especially poor households borrow is because they basically cannot make ends meet. They have to borrow, and so they are becoming indebted.
But there’s another reason, and that is, you know, why has there in the neoliberal decades been such a huge explosion in student debt? It’s because government cutbacks have stopped funding universities to the same extent. So fees go up.
And of course, the cost of living goes up for students because of course you can’t rent anything half decent, or even indecent, unless you pay a lot of money. And so all of these things drive up the cost of an education, which then means that students have to get a loan, and so on.
So essentially, cutbacks in social services, including, by the way, we haven’t talked about medical debt. A lot of the debt is incurred because people have to borrow money if they want to pay for certain medical procedures.
So all of these things just goes to show that once again, under neoliberalism, it’s ordinary people, the working people, and the poor people who get really shafted.
There’s another way in which these people get shafted. When you have a low interest rate fueled competition for buying houses, buying homes, typically the sharpest competition is happening at the lower end of the market.
So that the lower end market, that is to say the kind of houses and homes that first time buyers will buy, tend to see the most appreciation in prices as a result of competition among the lower end buyers. And this is what prices out so many people.
But a final thing I want to say is this expansion of debt is also interesting because it has taken place exactly in that era when the government, right at the beginning of the 1980s, committed itself to restricting money supply, it committed the Federal Reserve to restricting money supply in order to slay the dragon of inflation.
But what that has meant essentially is to have an economy in which people are making less money but incurring more debt. And essentially debt becomes the way in which money is issued into the economy.
And of course the Federal Reserve itself has kept up a policy going back to 1987 where no amount of money creation is too much if it is to bail out the financial sector. So from 1987 onwards, when you had the 1987 crash, Greenspan first engaged in this kind of liquidity provision in order to bail out the financial sector. It was called the “Greenspan put”.
Now over the years it has become a Federal Reserve put. And the result is, you know, we just showed you the chart of indebtedness. And according to the Federal Reserve, the total debt or non-financial debt in the United States is now close to three times U.S. GDP. It has doubled since 1980.
There is another point that is really interesting. These charts, the chart we showed you, does not include the vast amount of debt which the Federal Reserve has itself created in order to bail out the financial sector. And the top end of the corporate sector, starting in 2020, on which the financial sector relies for its best assets.
So essentially, and this was very surprising to me, in 2008, a scholar called James Fulkerson from your university, Michael, from UMKC (University of Missouri-Kansas City), showed that the Federal Reserve could not cope with the 2008 crisis by just playing its normal role of lender of last resort, by providing ample liquidity, slashing interest rates, etc. It slashed interest rates at that time from 5% to 0%. But this did not function to stabilize the system and even made it worse.
And then, according to Falkerson, the Federal Reserve engaged in a host of unconventional measures, unprecedented in terms of size or scope and of questionable legality. They’re his words. And the goal of these was to explicitly improve market conditions. And this program, according to him, amounted to a total of 29 trillion dollars.
MICHAEL HUDSON: You’ve gone very quickly over that, and I want to show how revolutionary this was. Until from the founding of the Federal Reserve to 2008, there was a basic philosophy of central banks going all the way back to the Bank of England and to the rules that people discussed in the 1880s and 1890s.
The idea of central banks, you used the words “lender of last resort”. That means everybody realized that sometimes when there would be a business downturn or a shift in interest rates, people would have very sound property. The buildings weren’t destroyed when they became insolvent. Companies weren’t destroyed.
But the problem is there was a temporary downturn in the business cycle. So banks are supposed to only borrow for short term and at a high penalty rate. Every central bank in the world followed the policy. You don’t subsidize rates for credit for banks.
Since 2008, the banks have taken control of the U.S. Treasury and taken control of the Federal Reserve to get all the money that they want for nothing. Actually, they’re paid to borrow.
After 2008, the Fed said, we’ve got to make bankers richer. Despite the fact that they’re paying themselves more than any other sector, they don’t have enough money to keep on lending. We will give them all the money they want. The way we’ll do this is the banks will make loans to corporations for takeovers, make loans for commercial real estate. They will transfer these IOUs to the Federal Reserve in deposits.
The Federal Reserve will lend them money in exchange for this. The banks have put all of their bad loans and shaky loans into the Federal Reserve. The Federal Reserve pays them interest on these deposits. The banks make interest not from the corporate borrowers, but the Federal Reserve is creating the interest to pay the banks to make this huge upsweep in loans.
You can look at that as an arm of Chase Manhattan and Citibank. Essentially, they’ve taken control of the Federal Reserve.
That’s really the libertarian ideal of a centrally planned economy planned by the banks. When the libertarians say, let’s get the governments out of business, let’s get the governments [to not] run a deficit, that means if the government doesn’t run a deficit, it’ll cut taxes, it’ll cut spending. That means that all the credit that people need, the economy needs, will be produced by the banks.
The Fed has said, now we’re going to really turn up the screws. We’re going to let the banks make 5% of the money. All of a sudden, this growth in the blue, the government debt that you saw, is going to soar. The interest rates are going to be such a large proportion of the government spending that they’re already talking about, we’re going to have to cut back Social Security and Medicare.
That’s what [Nikki] Haley, the Republican nominee, says. The Republicans want to say, if there’s a choice between paying Social Security and Medicare or paying interest to the banks and bondholders, the bondholders come first because they’re our campaign contributors. You don’t get campaign contributors from people who are broke because they don’t have the money that the banks have. Of course, we’re going to bail out our campaign contributors.
The government itself has been privatized. That’s what neoliberalism is. That’s what the anti-government libertarianism is. It means liberty for the banks and debt system for the population at large. That’s what these charts imply.
RADHIKA DESAI: Absolutely. I would say just one thing. Of course, most people will know this, but in case people don’t, the Federal Reserve is peculiar among the central banks of the world in being still privately owned. In that sense, I think that what Michael says is very relevant.
Essentially, what the Federal Reserve has done is over the last many decades, it has transformed the U.S. economy into an economy in which the primary way, the best way, the fastest way to make money is by essentially speculating, not by investing in the production of goods and services that ordinary people need, but by inflating the value of goods and services already produced.
Those of you who know a little bit of Marxism might appreciate it, but if Marx was around, he would have called it a very peculiar form of necromancy. What do I mean by that? Because already produced goods and services contain the dead labor that has gone, it is now dead, it is no longer living, that has gone into producing it and you are inflating the value of that.
Whereas, as you do that, you are disvaluing the living labor, much of which may remain unemployed, and all of which is necessary to produce the new goods and services which every year, in every period, ordinary people need.
We need more food, we need more clothing, we need more transportation, we need more housing, etc., etc. And these are the things that are strangulated. Living labor is strangulated while dead labor goes up. Because there’s something very peculiar.
Remember, as Michael pointed out, and as I pointed out, a lot of this debt has been incurred. In fact, most of it has been incurred to speculate, to inflate the value of already existing assets. And there’s something very peculiar about it, because imagine a house that goes up in price by 30%, 40%, 50%. Nothing in it may have changed, but it goes up in price anyway. Nothing is produced, but it goes up in price. So, this is the kind of economy that has been created.
And I just also want to show you one other outcome, just my last point this time around, but one other outcome of this vast increase, this vast federal government program to bail out the financial institutions.
So, you see here, this is a chart of the total assets on the Federal Reserve balance sheet.
And you see here, from up until the 2000s, it was basically hovering at about just below $1 trillion. In the 2008 financial crisis, it doubled, a little more than doubled actually, to over $2 trillion.
Then over the course of the decade that followed, thanks to quantitative easing in which the federal government essentially started a program to buy the worthless assets of the financial institutions for good money. This was quantitative easing, and so it piled on, it increased its own balance sheet while essentially making good the damaged balance sheets of the very financial institutions that had caused the 2008 financial crisis.
And then it was beginning to reduce its balance sheet when 2020 came, the pandemic came, and then you see that you have seen an absolutely unprecedented increase to $9 trillion of assets in the federal government. And this is the result of that $29 trillion worth of effort that the Federal Reserve made to bail out the financial sector.
So, please, Michael, go ahead, yeah.
MICHAEL HUDSON: When you use the [phrase] “worthless assets”, they weren’t exactly worthless if you could get 100% from the Federal Reserve. The word that was used by Marx and almost everyone in the 19th century and today was “fictitious capital”. In other words, all of these debts and bank assets were counted as an asset.
If a bank makes a loan to a large corporate property owner in an office building, the bank has that as an asset. But as we’re seeing today, these asset prices can’t be realized. In other words, what if the bank said, okay, now your mortgage is just falling due because it’s a balloon mortgage, you have to pay that. Every few years, you have to pay the entire amount or re-borrow it.
Well, all of a sudden, if it’s lent $100 million against an office building, and the office building is now worth $40 million, why would a bank lend $100 million to an owner of a $40 million office building? That’s the situation we’re in today.
Now, look at these two jumps. The first jump that you have after 2008, that’s the junk mortgage jump. All of these loans were against fictitious mortgages, mortgages that pretended that there was value there, but there were mortgages mainly to Black and Hispanic borrowers by banks who cheated them, who over-evaluated the prices.
The banks in general discovered a new way of making money after about 2004. They could make money by charging racial minorities much higher rates, almost double the rates that they charged white people. There were whole banks and brokers that specialized in this, and this was basically the junk mortgage group. Countrywide, Financial was the most obvious beneficiary of this.
There were a number of notorious banks that ended up being merged. Bank of America was one of the crooked banks. Citibank was one of the most crooked banks, as has been very well documented.
Randall Wray at the Levy Institute and Kansas City published a big explanation of who were these $29 trillion, $27 trillion of loans for. It ended up many of these loans were rolled over and reloaned, so the net amount was not $27 trillion, but that’s how much was given to the banks with this huge jump. Instead of sending the bankers to jail, they made them billionaires. They rewarded them.
That was the Obama policy, and that is what makes them one of the most viciously racist presidents in modern American history. The Democratic Party became committed to returning to its pre-Civil War racist policies.
Well, the next group is you see in 2020-21, this huge jump in bank loans. What were they from? The Federal Reserve began to raise interest rates. When the Federal Reserve raises interest rates from less than 1% to 5%, this means all of a sudden debtors had to pay 10 times as much interest as they did before.
What that did was that reduces the price of an asset. It’s an inverse proportion to the interest rate. All of a sudden, the stocks and the bonds held by the banks that went under were fictitious.
In fact, although Silicon Valley Bank and New York Bank went under, all of the banks, especially Citibank and Chase Manhattan, had all of the loans that they had. All of a sudden, they were not worth anywhere near what they carried them on the books. The banks were insolvent.
Now, here was a wonderful opportunity. The Federal Reserve could have taken them over by the government and said, you’re insolvent. We’re going to wipe out the stockholders and the bondholders because you’ve made bad loans. Instead, the Federal Reserve said, well, instead of making the banks insolvent, let’s make the economy insolvent.
That’s the policy we’re in today. This increase in Federal Reserve loans has been to support this upsweep of credit that is increasing the burden. All of this upsweep in credit is far in advance of the wages and salaries that people are getting.
Somehow, all this increase in interest charges and amortization charges and penalty fees end up impoverishing the economy by leaving less to spend on food and clothing and other consumer spending. If consumer spending is going up, it’s because of the inflation.
RADHIKA DESAI: A small correction. This big increase, of course, was increased because the Federal Reserve started a new, massive liquidity provision program, quantitative easing program, when the pandemic hit. And the one that you’re talking about, where essentially they were bailing out Silicon Valley Bank, etc., this is the small increase here, which is what happened after interest rates started rising. But throughout this period, right up until about here, interest rates remained at historic lows.
And just one other thing I wanted to say about this before we close this chat, which is that, you know, around 2013, about here, essentially, the Federal Reserve decided that it was going to try to decrease the size of its balance sheet.
So you can see, you know, it was still only about three and a half trillion, not the nine trillion that it is today. But you know what the financial institutions and the financial sector did? The financial sector at the time, in 2013, threw a “taper tantrum”.
The Federal Reserve was threatening to taper its balance sheets essentially, you know, to decrease it. And they said, we’re not having it. You’ve got to keep supporting us and you’ve got to buy our assets. And so essentially, the Federal Reserve humored them in their tantrum and they continued to expand the balance sheet. And then, as we saw in the pandemic, did even more so, etc. So that’s the thing we’re looking at.
And the other thing I just wanted to point out, of course, is that, you know, I completely agree with everything that Michael said about just how racist the system is, because at the end of the day, you know, people think that debt is a market relationship.
Debt is not a market relationship. It’s a relationship between, on the whole, relatively privileged people, one of which decides to lend money to the other. So the idea that somehow, by passing a piece of legislation, you can make the poor people of the United States, the black people of the United States, the Hispanic people of the United States into homeowners, this was always a bit problematic.
And in the end, the whole 2008 financial crisis, the vast buildup of debt that preceded it, only a tiny fraction, which happened towards the very end of that vast increase, was actually loans to subprime borrowers. The financial institutions only began lending to the subprime borrowers once they had filled the prime borrowers to the gills with all the debt they could take, and only then they moved.
And so, in many ways, the subprime borrowers came last, and they were also, of course, the ones to suffer the most. So, yeah, I mean, I think these are really, so really we are living in an economy that is awash with debt, as we were just saying, and it really is the opposite of the sort of economy we ought to have.
And Michael, you know, one of the things about the whole classical conceptions of land and rent and interest and so on is, of course, that classical political economy always looked down on things like this, like interest and rent, because it saw it as unearned income, isn’t it?
MICHAEL HUDSON: Well, I could have a whole hour on that, but I want to follow up with some charts on the racial element of this. We’ve talked about how the volume of debt is too large to be paid, but I want to say there’s another aspect of debt, and if you could show the racial, that’s right, that chart is very interesting.
One of the results of debt is to create a bifurcated economy, and that means that we’re in a kind of apartheid economy. We’re in a financial apartheid economy. 10% of the population owns over 75% of the stocks and bonds in the population, and they’re almost entirely a white population.
We’ve talked about mortgage debt being 80% of the overall debt burden. I want to show what has happened long before the chart begins in 2002.
I want to begin in 1945 at the end of World War II. That’s really when the houses had not been built during the Depression because people, there wasn’t a market for them. They weren’t being built during World War II because all of the raw materials were going to the war effort, and debt for the whole economy was very, very low debt in 1945 because there was nothing to borrow money for. You couldn’t borrow money to consume because everything was rationed anyway.
But finally, they began to make loans, and what had spurred the American takeoff and that of other countries. All countries of Europe, America, and elsewhere were rebuilding after the war, and most of this rebuilding was rebuilding for housing. That was when the great housing was taking place. Here in Queens, you had major developers, not only Trump’s father, but all the famous experiments and group housing were made.
There was only one thing. White people were able to buy houses for maybe $10,000 was a typical price of a house that now costs a million dollars. The problem is that banks would only, in order to buy a house, you had to take out a mortgage. Nobody has enough money to buy the whole value of a house, and if wages were maybe $3,000 or $4,000 a year back in 1945, you couldn’t even buy a $10,000 house. Nobody had that. You had to go to the banks. Banks, until about 2000, 2001, would only make mortgage loans almost entirely to white people, unless you were a very, very wealthy black person or a Hispanic.
What you created was a bifurcated society. The people who bought the houses in 1945—they returned from the war. They took civilian jobs. They bought a house, and many of them died of old age, but they left the houses to the children.
And you had one generation after another generation of white people leaving the house to the children, leaving them enough inheritance to have a house of their own and an education of their own. So what you had was a home-owning, educated white class, but this was not available to non-whites in this country.
So what’s the depth of the restriction of credit to the prime human beings, not to the unprimed borrowers? We’re talking about a pretty racist policy. It was very responsible for the fact that you’ve had now 75 years—well, longer than that, 75 years since World War II—you have a disenfranchised, non-white class in the United States of hereditary homeowners who can get into college because their parents and grandparents went to an Ivy League university.
And there’s a monopoly of housing and education and wealth at the top of the economic pyramid, and the rest of the economy is essentially disenfranchised as if we’re in our own financialized apartheid economy.
RADHIKA DESAI: Yes, and there’s a couple of other points. By the way, in this chart, I should just explain that the top line here is essentially showing the home ownership rates, that is about 75 percent, of non-Hispanic whites in the United States.
The red line, which is at the bottom here, is of black people alone in the United States, and then the green line is of Hispanics of any race in the United States. So that presumably includes, for example, if you were a relatively white Hispanic, and they do a little bit better.
But you can see that the rate of ownership of black people from the early 2000s till today has really not budged. If anything, it’s slightly worse today than it used to be back then, and became considerably worse just before the pandemic, reaching a very low level of below, like around 40 percent, in fact. So anyway, that’s the thing.
But in addition to these things, the kind of financialized economy in which we live, increasingly owning of houses and land, etc., does not necessarily, because of mortgages, the ownership of land or houses does not necessarily confer on you any privilege, because homeowners find that they are paying interest to banks, and even landlords typically are highly leveraged, so the bulk of what they are collecting in rent actually ends up as interest to banks.
So in a certain sense, what we are trying to say is that the Federal Reserve has engineered an economy in which not only profits and wages have become essentially in hock to pay interest, are used to pay interest, but so is rent. So that interest has become sort of the prime form of income, at the top of the income pyramid, so to speak.
And this is a result of changes also in the tax structure. So for example, in the U.S. taxation system, earnings from interest and rent are treated a lot more softly, a lot more favorably than our earnings from work. This is a huge problem.
MICHAEL HUDSON: That sort of goes back to the value theory that I think requires a separate discussion altogether, because it’s so fundamental.
The whole idea of classical economics and the free market was a market to be free from rent, rent being unearned income. Rent is what landlords make in their sleep.
Rent is not created by labor, and most people don’t realize what’s called the labor theory of value that is based on Ricardo and Marx and the whole 19th century.
The idea was to separate value, which is created by labor, from economic rent, which is created by hereditary, by privilege, by property ownership, by owner, by banking, and by monopolists, and by landlords who make their money, economic rent, by owning a rental property, or by lending money and making interest, or by having a company, a monopoly.
And you just raise prices, and much of the inflation, as Radhika mentioned at the beginning of the talk, they call it profit inflation, meaning a company just decides, let’s raise the price of drugs.
For instance, my wife is on an employer, United Healthcare plan. The price that she has to pay, local drugstores went up quintupled on January 1st, because the healthcare insurer said, we can make money by quintupling the price.
Drug companies have been raising the prices all across the board, not by producing more, not because their costs have gone up, which would be, ultimately, the cost would be a cost of production, labor, and materials, but simply because they’ve become a monopoly.
And the Democratic Party has always been the great protector of monopolies, because they’re campaign contributors. And if you look at who heads the health committees and the others in Congress, related committees in Congress, their campaign contributors come from the pharmaceutical and drug industry.
So you have the governments representing their campaign contributors, the military and state department desks at the Senate and House are subsidized and paid for by the military industrial complex, the health departments from the drug companies, and so on and so forth.
So we’re that part of the problem of what has made America a failed economy. And it’s a failed economy because of the austerity that this debt apartheid has created.
RADHIKA DESAI: And we should probably soon shift to talking about solutions. But let me just add a small point to what you were saying, which is that, of course, if you look at the US economy today, you will see that over the neoliberal period, what has happened is that it has become dominated, of course, by the financial sector, the so-called FIRE sector, finance, insurance, and real estate.
And on top of that, if you look at what are the other sectors of the US economy, which are really important and lucrative, you will see that they are the military industrial complex, they are the big pharma, and they are information and communications technology.
And in pretty well all of these cases, these sectors are characterized by a high degree of monopoly, a high degree of rent-seeking in the sense that a military industrial complex, for example, essentially relies on vast government contracts, which are risk-free in which they get to mark up costs as much as they like.
And big pharma and information and communications technology rely on intellectual property rights in order to secure their monopoly.
So in all of these ways, this has created an economy which is very undynamic, it is not very efficient, but at the same time, it is very lucrative for those who own it, which of course puts an added burden on ordinary Americans.
MICHAEL HUDSON: Well, one of the problems of it being undynamic is you’re having a decline in office space, in commercial real estate. We’ve been talking about homeownership rates and how unfair that is, but you remember back in 2008 when there was the property price crash, you had what was called “jingle mail”.
You would have buyers, especially in Nevada and Florida, where there was a huge run-up in housing prices, they’d say, okay, I owe $500,000 for this house, but now the house just like it next door is selling for $300,000. I’ll just mail back the keys to the bank and say, okay, I’m defaulting, you can have the house, I’m just not going to pay, I’m going to take out a new loan and buy the house next door.
Well, that phenomenon is now happening for businesses. Apparently [only] 40% of the US commercial properties are occupied. In other words, since COVID, and most of all, since the economy began to shrink as a result of this debt deflation, businesses have been going out of business.
Even those who are in business, you have people working from home. Now, if you have the average occupancy rate of buildings being only 40%, how is the owner going to have the money to pay for the bank?
Well, because the banks have lent almost 100% of the value of the building to the homeowner who’s willing to pay all of the rents as interest, rent is for paying interest, that’s the basic motto.
What they want is the capital gain in the price of the building. They realize they’re not going to be a capital gain. This was all fictitious capital, it’s going down, we’re mailing our keys back to the bank and we’re walking away from the building.
This year and next year, there is such an enormous trillions of dollars of commercial real estate falling due, not only here, but in England and other countries, that the banks are all of a sudden going to be left with mortgages that are unpaid.
Against these mortgages, they have liabilities to their depositors, to their bondholders, and most of all, they want to pay millions of dollars to the, I think Jamie Dimon, the head of Chase Manhattan, gets $29 million a year for running a company that’s gone bankrupt and is kept alive because he gives some of that $29 million to the politicians who continue to appoint Federal Reserve people who will bail them out. That’s what you call a circular flow.
What are you going to do when all of a sudden the banks should be going under? Well, normally, if they’ve made a bad loan, somebody has to suffer. Who’s going to suffer?
As Bill Clinton said when he was told you have to do what Alan Greenspan says and support the banks, Clinton said, oh, it’s all about the bondholders.
In 2009, when Obama came in and decided to bail out the banks, Sheila Bair, the head of the Federal Deposit Insurance Corporation, said, wait a minute, we have a crooked, incompetent bank. There’s one bank in America that’s more crooked than all the others and more incompetent. That’s First National City Bank. Let’s take it over. Let’s make it a public bank. You can’t let this bank destroy the whole economy by being so greedy that it makes loans way in excess of the value of property and keeps expecting to be bailed out so it can make more interest and pay its officers more. Let’s drive it under.
And Obama and his Treasury secretary, Tim [Geithner], said it’s all about the bondholders who own the bank.
So the question is, what will the banks do when all these mortgage loans go under? Well, wipe out the stockholders.
But the bondholders are the wealthiest 1% of the population. They’re the ones who own most of the bank bonds.
Who do you think the government is going to support? Is it going to support the economy or the stockholders or the 1%?
That really is the way in which you should think about an economy being an apartheid economy, not simply ethnically and racially, but financially. That’s the real apartheid between creditors and debtors that I think all of our shows are examining from different perspectives.
RADHIKA DESAI: Well, I’d just like to add a couple of points to what you were saying, Michael. This is very interesting because if you look at commercial real estate, there’s no doubt for the last many months there have been headlines about how there is a collapse of commercial real estate prices. It’s coming. In fact, it’s already happening.
As Michael says, the fall in the value of commercial real estate is already ongoing from what we read in the financial press. The really big prestige buildings may not be affected, but the next layer and down, all these buildings will be affected.
Everybody who has walked around a big city in North America or for that matter elsewhere in Europe will see that commercial space is essentially going down. So many are boarded up. So many are empty and so on.
And according to one measure, about 10% of US bank assets actually rely on the value of commercial real estate. Now, Michael asks, you know, when the crisis comes, well, the crisis is already here.
So who is the Federal Reserve going to help? But you know what, I’m not even sure. And the US government, who are they going to help? Who are US authorities going to help?
I’m not even sure they’re going to be able to help them because the fact is that as the value of these assets decline, banks already have to report them if they are publicly listed on an ongoing basis, which means that their shares will already go down.
And there is no doubt that a crash will come. And when it comes, yes, the Federal Reserve will once again, as you saw with the Silicon Valley Bank, essentially, in fact, there was another point that I wanted to make there. Essentially, Ms. [Janet] Yellen stepped forward and said, we are going to guarantee all depositors, even if their deposits are higher than $250,000.
Now, you might think that this is somehow a very democratic thing. But on the contrary, if you look at what kind of bank Silicon Valley Bank was, essentially, it was like a club in which a select group of rich people who are all connected with one another lent each other vast quantities of money.
Now, what does lending mean? It means that I go to my friend and, you know, Silicon Valley Bank and say, you know, please give me $5 million. I’m going to have a startup. You don’t even look at whether my startup is worth supporting. You just say, okay, I’ll give you, I’m going to show a deposit of $5 million in your account. These are the deposits that Ms. Yellen was protecting.
This is not even the money that they have deposited in the bank. This is money that is in a deposit in my name because it has been lent to me.
So, if you think about just how huge is the boondoggle that is protecting the interests of the tiny minority of the very wealthy, I hope in this program we’ve given you some idea of the lengths to which US authorities have gone to protect the wealth of this minority.
And in our next show, maybe what we’ll do is we are going to devote it entirely to talking about what needs to happen if we are going to move away from this kind of economy.
MICHAEL HUDSON: That’s a good way to end it. There’s so much that it’s leading into. And the last thing that the Federal Reserve wants is for—what if banks reported the actual market value of their assets?
When you have a balance sheet, assets and liabilities, they’re holding the assets at the price that they made the loan for, say $100 million for a building. But what if they reported their assets as only $40 million for the building? You would have bank assets here and the liabilities here. They’d look just like most people in America.
50% of Americans don’t have any assets, but they have a big debt. That’s an interesting bar chart to show, assets, liabilities. And you can look at it by income group.
The Federal Reserve does not produce believable statistics on debt as a proportion of income.
If you look at the Federal Reserve statistics of debt to income by percentile, 10%, 20%, nothing has changed in the last 50 years. Nobody’s run into debt at all. Because they say, let’s assume that debt is constant for the last half century. The statistics are fictitious.
And they’re fictitious because that protects the fact that most of this, what passes as bank capital is fictitious. I mean, we’re in a fictitious economy.
It’s sort of like trying to read about international affairs in the New York Times. That’s about as realistic as the Federal Reserve statistics are.
RADHIKA DESAI: Exactly. I mean, it’s basically the rich people of the United States and the big financial institutions of the U.S. are in a situation in which, you know, they make a bad investment, they make a loss and they go, oops.
And then the Federal Reserve, which is their sugar daddy, essentially comes and makes good all their losses. It gives them more money to plug the holes in their balance sheets that they have themselves created out of their own greed and misjudgment and bad judgment.
So there we have it. It’s this kind of economy that, unfortunately, the United States is laden down with today. And so the question naturally arises, what kind of economy do Americans need in its place?
MICHAEL HUDSON: I want to add one point out there. The important thing is that these rich people who are not paying their debts do not have to pay penalty rates. The large businessmen who owe debts don’t pay penalty rates.
You know that if you’re a family and you’re running a credit card debt, if you miss a payment in your electric bill or anywhere, your rate goes up from 19 percent to 30 percent or more.
That’s not the case if you’re rich people. There’s one set of interest rates and penalties for 99 percent of the population, another set for the wealthiest 1 to 10 percent of the population, and you’re not in it.
RADHIKA DESAI: And that’s what we call financial apartheid. So I think with that, Michael and I will say goodbye and hope to see you in a couple of weeks and we’ll talk about what kind of economy we need instead.
Thanks very much for joining us, and see you in a couple of weeks. Bye bye.
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